10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 10-K

______________________________________

(Mark One)

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-13828

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MEMC Electronic Materials, Inc.

(Exact name of registrant as specified in its charter)

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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)

Registrant’s telephone number, including area code:

(636) 474-5000

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Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered:
$.01 Par Value Common Stock	New York Stock Exchange

Securities Registered Pursuant to Section 12(g) of the Act:

None

(Title of Class)

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes   x   No  o

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Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  o     No  x

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x     No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

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

Large accelerated filer  x   Accelerated filer  ¨    Non-accelerated filer  ¨    Smaller reporting company  ¨

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

The aggregate market value of the registrant's Common Stock held by nonaffiliates of the registrant, based upon the closing price of such stock on June 30, 2012 of $2.17 as reported by the New York Stock Exchange, and 230,551,572 shares outstanding on such date, was approximately $500,296,911. The number of shares outstanding of the registrant's Common Stock as of February 25, 2013, was 231,325,319 shares.

DOCUMENTS INCORPORATED BY REFERENCE

1. Portions of the registrant’s 2012 Annual Report to Stockholders (Part I and Part II)

2. Portions of the registrant’s 2013 Proxy Statement (Part III)

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Table of Contents

		Page
Part I.
Item 1.	Business	1
Item 1A.	Risk Factors	11
Item 1B.	Unresolved Staff Comments	28
Item 2.	Properties	28
Item 3.	Legal Proceedings	29
Part II.
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	33
Item 6.	Selected Financial Data	33
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	33
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	33
Item 8.	Financial Statements and Supplementary Data	33
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	33
Item 9A.	Controls and Procedures	33
Item 9B.	Other Information	33
Part III.
Item 10.	Directors, Executive Officers and Corporate Governance	34
Item 11.	Executive Compensation	34
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	34
Item 13.	Certain Relationships and Related Transactions, and Director Independence	34
Item 14.	Principal Accounting Fees and Services	35
Part IV.
Item 15.	Exhibits, Financial Statement Schedules	36
	Signatures	44
	Exhibit Index	45

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PART I

Item 1. Business

Overview

MEMC is a global leader in the development, manufacture and sale of silicon wafers, and with the acquisition of SunEdison, a major developer and seller of photovoltaic energy solutions. Through SunEdison, MEMC is one of the world's leading developers of solar energy projects and, we believe, one of the most geographically diverse. MEMC's technology leadership in silicon and downstream solar are enabling the company to expand its downstream customer base and lower costs throughout the silicon supply chain.

MEMC is organized by end market. Until our acquisition of SunEdison, we were engaged in one reportable industry segment - the design, manufacture and sale of silicon wafers - which was conducted as our Materials Business. From the time of the SunEdison acquisition until the end of fiscal 2009, we were engaged in two reportable segments, Materials Business and Solar Energy (at that time, consisting solely of the operations of SunEdison). Effective January 1, 2010 until the end of fiscal 2011, we reorganized our historical Materials Business operations into two separate businesses, and during that time were engaged in three reportable industry segments: Semiconductor Materials, which provides silicon wafers ranging from 100 millimeter (4 inch) to 300 millimeter (12 inch) as the base material for the production of semiconductor devices; Solar Materials, which manufactures and sells silicon wafers for solar applications; and Solar Energy, which was the SunEdison solar energy systems business unit. In connection with our announced December 2011 restructuring, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date have been engaged in two reportable industry segments:

• Semiconductor Materials; and

• Solar Energy.

Financial segment information for our two reportable segments for 2012 is contained in our 2012 Annual Report, which information is incorporated herein by reference. See Note 20, Notes to Consolidated Financial Statements.

MEMC was formed in 1984 as a Delaware corporation and completed its initial public stock offering in 1995. Our corporate structure includes, in addition to our wholly owned subsidiaries, an 80%-owned consolidated joint venture in South Korea (MEMC Korea Company or MKC). We also have five consolidated joint ventures related to the construction and operation of solar energy systems.

Our principal executive offices are located at 501 Pearl Drive (City of O'Fallon), St. Peters, Missouri 63376, and our telephone number is (636) 474-5000. Our website address is www.memc.com.

Recent Events

The significant 2011 downturn in the solar industry continued throughout 2012 and resulted in sharp reductions in pricing of solar modules, solar cells, solar wafers, polysilicon, and to a lesser extent, solar systems. The resulting decline in profitability for all solar companies, including MEMC, has been pronounced. Our Semiconductor Materials business also faced depressed market conditions in 2012.

During the fourth quarter of 2011, in order to better align our business to the then current and expected market conditions in the semiconductor and solar markets, as well as to improve the company's overall cost competitiveness and increase cash flow generation across all segments, we committed to a series of actions to reduce the company's global workforce, right size its production capacity and accelerate operating cost reductions in 2012 and beyond (the "2011 Global Plan"). These actions included reducing the total workforce by approximately 20%, shuttering the company's Merano, Italy polysilicon facility, reducing production capacity at the company's Portland, Oregon crystal facility and slowing the ramp of the Kuching, Malaysia facility, as well as consolidating our solar wafering and solar energy systems operations into a single Solar Energy business unit effective January 1, 2012.

Throughout 2012, we continued the implementation of the 2011 Global Plan. As part of those efforts, on September 4, 2012 we executed two settlement agreements with Evonik to settle disputes arising from our early termination of two take-or-pay supply agreements related to the Merano, Italy polysilicon facility shuttered as part of the 2011 Global Plan. Pursuant to the settlement, we forfeited a deposit of $10.2 million and will pay Evonik an additional 70 million Euro, of which 25 million Euro was paid in 2012, with the remaining 45 million Euro to be paid in three installments over the first three quarters of 2013.

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Our business strategy is designed to address the most significant opportunities and challenges facing the company, including managing cash flow and liquidity risks, executing on our restructuring plans, focusing on semiconductor market share gains, expanding our product platform, and optimizing solar project pipeline. In furtherance of that strategy, we closed on a $200.0 million second lien term loan during the 2012 third quarter. This term loan has a maturity of five years with a variable rate, which as of December 31, 2012 is at 10.75%. The company plans to use the proceeds of this term loan for incremental liquidity and general corporate purposes.

Semiconductor Materials Segment

Wafers for Semiconductor Applications. Almost all semiconductor devices are manufactured using silicon wafers. Wafers are becoming increasingly differentiated by specific physical and electrical characteristics, such as flatness and defect free, uniform crystal structures. Semiconductor device manufacturers continue to evolve to devices with shrinking geometries and more stringent technical specifications. Wafers required to produce these next generation devices are being developed in larger sizes, with the 300 millimeter wafer now being the primary wafer diameter used today.

We offer wafers with a wide variety of features satisfying numerous product specifications to meet our customers’ exacting requirements. Our wafers vary in size, surface features, composition, purity levels, crystal properties and electrical properties. We provide our customers with a reliable supply of high quality wafers with consistent characteristics.

Our monocrystalline wafers for use in semiconductor applications range in size from 100 millimeter to 300 millimeter and are round in shape for semiconductor customers because of the nature of their processing equipment. Our wafers are used as the starting material for the manufacture of various types of semiconductor devices, including microprocessor, memory, logic and power devices. In turn, these semiconductor devices are used in computers, cellular phones and other mobile electronic devices, automobiles and other consumer and industrial products. Our monocrystalline wafers for semiconductor applications include four general categories of wafers: prime, epitaxial, test/monitor and silicon-on-insulator (SOI) wafers.

Prime Wafers

Our prime wafer is a polished, highly refined, pure wafer with an ultraflat and ultraclean surface. The vast majority of our prime wafers are manufactured with a sophisticated chemical-mechanical polishing process that removes defects and leaves an extremely smooth surface. As semiconductor devices become more complex, wafer flatness and cleanliness requirements, along with crystal perfection, become increasingly important because these properties have a significant impact on our customers' processes and yields.

Our OPTIA™ wafer is a 100% defect-free crystalline structure based on our patented technologies and processes, including Magic Denuded Zone^®, or MDZ^®. Our patented MDZ^® product feature can increase our customers' yield by drawing impurities away from the surface of the wafer in a manner that is efficient and reliable, with results that are reproducible. We believe the OPTIA™ wafer is the most technologically advanced polished wafer available today. Our annealed wafer is a prime wafer with near surface crystalline defects dissolved during a high-temperature thermal treatment.

Epitaxial Wafers

Our epitaxial, or epi, wafers consist of a thin silicon layer grown on the polished surface of the wafer. Typically, the epitaxial layer has different electrical properties from the underlying wafer. This provides our customers with better isolation between circuit elements than a polished wafer, and the ability to tailor the wafer to the specific demands of the device. Without sufficient isolation of the various circuit elements, the elements could communicate electrically with each other, which could render the device useless. Epitaxial wafers provide improved isolation, thereby allowing for increased reliability of the finished semiconductor device and greater efficiencies during the semiconductor manufacturing process, which ultimately allows for more complex semiconductor devices.

Our AEGIS™ product is designed for certain specialized applications requiring high resistivity epitaxial wafers and our MDZ^® product feature. The AEGIS™ wafer includes a thin epitaxial layer grown on a standard starting wafer. The AEGIS™ wafer’s thin epitaxial layer eliminates harmful defects on the surface of the wafer, thereby allowing device manufacturers to increase yields and improve process reliability.

Test/Monitor Wafers

We supply test/monitor wafers to our customers for their use in testing semiconductor fabrication lines and processes. Although test/monitor wafers are substantially the same as prime wafers with respect to cleanliness, and in

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some cases flatness, other specifications are generally less rigorous. This allows us to produce some of the test/monitor wafers from the portion of the silicon ingot that does not meet customer specifications for wafers.

Silicon-on-Insulator Wafers

An SOI wafer is a different starting material for the chip making process. SOI wafers have three layers: a thin surface layer of silicon (from a few hundred Angstrom to several microns thick) where the transistors are formed, an underlying layer of insulating material and a support or “handle” bulk silicon wafer. The insulating layer, usually made of silicon dioxide, is referred to as the "buried oxide" or "BOX" layer and is usually a few thousand Angstroms thick. Transistors built within the top silicon layer typically switch signals faster, run at lower voltages and are much less vulnerable to signal noise from background cosmic ray particles. Each transistor is isolated from its neighbor by a complete layer of silicon dioxide.

Sales and Marketing. We market our semiconductor wafer products primarily through a direct sales force. We have customer service and support centers through a global network in various countries, including in China, France, Germany, Italy, Japan, Malaysia, Singapore, South Korea, Taiwan and the United States. A key element of our sales and marketing strategy is establishing and maintaining close relationships with our customers. We accomplish this through multi-functional teams of technical, sales and marketing and manufacturing personnel. These teams work closely with our customers to optimize our products for their current and future production processes, requirements and specifications. We monitor changing customer needs and target our research and development and manufacturing to produce wafers adapted to each customer’s processes, requirements and specifications. We make sales of semiconductor wafers principally through agreements of one year or less (such agreements often are of three months or six months duration), which specify price and typically indicate only estimated volumes or market share.

We sell some of our semiconductor wafers to certain customers under consignment arrangements. Generally, these consignment arrangements require us to maintain a certain quantity of wafers in inventory at the customer’s facility or at a storage facility designated by the customer. Under these arrangements, we ship the wafers to the storage facility, but do not charge the customer or recognize revenue for those wafers until title passes to the customer. Title passes when the customer pulls the product from the assigned storage facility or storage area or, if the customer does not pull the product within a stated period of time (generally 60-90 days), at the end of that period, or when the customer otherwise agrees to take title to the product. Until that time, the wafers are considered part of MEMC's inventory and are reflected on MEMC's books and records as inventory. As such, these consignment arrangements are essentially inventory transfer arrangements. At December 31, 2012, we had approximately $27.6 million of inventory held on consignment, compared with approximately $28.0 million held on consignment at December 31, 2011.

Manufacturing. To meet our semiconductor wafer customers' needs worldwide, we have established a global manufacturing network currently consisting of eight manufacturing facilities. In an effort to reduce manufacturing costs and to shift manufacturing to locations closer to our customers, in 2009, we committed to terminate certain manufacturing in St. Peters, Missouri and Sherman, Texas. In 2011, we ceased all production at our Sherman, Texas facility. We intend to sell this facility, although there can be no assurance that we will be successful in selling the facility. In 2012, we ceased all production at our St. Peters, Missouri facility, except for 150mm crystal growing and advance SOI manufacturing, which are expected to continue at this facility. MEMC corporate headquarters and research and development are also expected to continue at the St. Peters facility. We have transferred operations to our new semiconductor wafer manufacturing facility in Ipoh, Malaysia.We completed construction and commenced commercial shipments from this facility in the third quarter of 2010. We have also invested significantly, and are continuing to investto expand our 300 millimeter production capacity in our manufacturing facilities.

Our monocrystalline wafer manufacturing process begins with high purity polysilicon. The polysilicon is melted in a quartz crucible along with minute amounts of electrically active elements such as arsenic, boron, phosphorous or antimony. We then lower a silicon seed crystal into the melt and slowly extract it from the melt. The resultant body of silicon is called an ingot. The temperature of the melt, speed of extraction and rotation of the crucible govern the size of the ingot, while the concentration of the electrically active element in the melt governs the electrical properties of the wafers to be made from the ingot. This is a complex, proprietary process requiring many control features on the crystal-growing equipment.

After the crystal ingot is grown, we grind the ingots to the specified size and slice them into thin wafers. Next, we prepare the wafers for surface polishing with a multi-step process using precision wafer planarization machines, edge contour machines and chemical etchers. Final polishing and cleaning processes give the wafers the clean and ultraflat mirror polished surfaces required for the fabrication of semiconductor devices. We further process some of our products

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into epitaxial wafers by utilizing a chemical vapor deposition process to deposit a single crystal silicon layer on the polished surface.

Our semiconductor wafer manufacturing facilities vary as to their capabilities and functions. In certain of our manufacturing facilities, we have fully integrated manufacturing capabilities that encompass the full range of wafer manufacturing process steps, including ingot growth, wafer slicing, wafer polishing and epitaxial deposition. We conduct certain of our processes in state-of-the-art clean room environments.

Raw Materials. We obtain our requirements for several raw materials, equipment, parts and supplies from some sole suppliers, in addition to other sources. The main raw material in our semiconductor wafer manufacturing process is polysilicon. See the description of our polysilicon production below under "Solar Energy Segment—Suppliers and Raw Materials."

Customers. Our semiconductor wafer customers include virtually all of the world’s major semiconductor device manufacturers, including the major memory, microprocessor and ASIC manufacturers, as well as the world’s largest foundries.

Competition. The market for semiconductor wafers is competitive. We compete globally and face competition from established manufacturers. Our major worldwide competitors are Shin-Etsu Handotai, SUMCO, Siltronic and LG Siltron. Our wafers compete on the basis of product quality, consistency, price, technical innovation, customer service and product availability. We believe we are competitive on these factors.

Solar Energy Segment

Overview. Our Solar Energy segment includes the operations of our old Solar Materials segment as well as our SunEdison business. We combined these segments effective January 1, 2012 as part of the restructuring related to the 2011 Global Plan.

On December 8, 2011, we announced a global restructuring to reduce the company's global workforce, modify our production capacity and accelerate operating cost reductions in 2012 and beyond. We committed to these actions in response to the then current and expected market conditions, including the significant price declines in the upstream solar market resulting from worldwide overcapacity as well as reduced demand in the solar market. In addition to shuttering our Merano, Italy polysilicon facility, we reduced production capacity at our Portland, Oregon solar monocrystalline facility and limited the capacity ramp of our Kuching, Malaysia solar wafer facility to 300MW. To focus on providing our downstream solar customers with quality, low cost systems and to achieve improved operating efficiencies, we consolidated the Solar Materials and Solar Energy (SunEdison) segments into a single Solar Energy segment. All financial information for the Solar Energy segment for 2012 and applicable periods prior to 2012 (which have been recast to include the Solar Materials and Solar Energy segments for all periods prior to January 1, 2012) is set forth in Note 20, Notes to Consolidated Financial Statements contained in our 2012 Annual Report, which information is incorporated herein by reference.

Our Solar Energy segment provides solar energy services that integrate the design, installation, financing, monitoring, operations and maintenance portions of the downstream solar market to provide a comprehensive solar energy service to our customers. Through SunEdison, we are a leading global solar energy services provider. As of December 31, 2012, SunEdison has interconnected over 675 solar power systems representing 989MW of solar energy generating capacity. As of December 31, 2012, SunEdison had 73MW of projects under construction and 2.6 gigawatts ("GW") in pipeline. A solar energy system project will be classified as "pipeline" when SunEdison has a signed or awarded power purchase agreement (PPA) or other energy off-take agreement or has achieved each of the following three items: site control, an identified interconnection point with an estimate of the interconnection costs, and an executed energy off-take agreement or the determination that there is a reasonable likelihood that an energy off-take agreement will be signed. "Under construction" refers to projects within pipeline, in various stages of completion, which are not yet operational. There can be no assurance that pipeline will be converted into completed projects or generate revenues or that we can obtain the necessary financing to construct these projects.

In support of our downstream solar business, our Solar Energy segment manufactures polysilicon, silicon wafers and solar modules. While there continued to be external solar wafer sales during 2012, these sales were significantly diminished from prior year sales levels and, going forward, solar wafer sales to external parties are expected to continue to decline to or remain at lower levels given our strategic shift to primarily supplying wafers for internal consumption by our SunEdison business. Additionally, our Solar Energy segment will sell solar modules to third parties in the event the opportunity aligns with our internal needs.

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As a result of continued declines in solar wafer pricing, we have elected to limit the capacity ramp of our solar wafer manufacturing facility in Kuching, Malaysia to 300MW. We also have reduced production capacity at our Portland, Oregon crystal facility in order to improve costs and alignment with current market conditions. Consistent with our existing solar strategy, we will continue to utilize our joint ventures and partner with third-party vendors under long-term supply agreements to procure or have manufactured solar modules for use in our SunEdison business. Our SunEdison business is focused on the installation of solar energy systems that are connected to the electricity grid. A wide variety of international and U.S. federal, state and local government and utility commission rules, regulations and policies affect our ability to conduct our business. See "Regulation" below.

We provide our downstream customers with a simplified and economical way to purchase renewable energy by delivering solar power under long-term power purchase arrangements with customers or feed-in tariff arrangements with government entities and utilities. Our SunEdison business is heavily dependent upon government subsidies, including U.S. federal incentive tax credits, state-sponsored energy credits and foreign feed-in tariffs. In certain jurisdictions, the sale of a solar energy system would not be profitable today without these incentives. Our customers pay us only for the electricity output generated by the solar energy systems we install on their rooftops, or other property, thereby avoiding the significant capital outlays otherwise usually associated with power plant projects, including typical solar power plants. Once installed, our solar energy systems provide energy savings to customers and enable them to hedge a portion of their energy costs against volatile electricity prices by generating electricity during daylight hours when electricity prices are typically highest.

Our objective is to develop solar power generation assets that serve as a cost-effective clean energy alternative to central-generated power in select markets throughout North America, Europe, the Middle East, South Korea, Thailand, Malaysia, India, China, South Africa and, in the future, other countries in Asia and in South America. Outside of the United States, including in Europe, Asia and Canada, projects are developed and operated pursuant to a government feed-in tariff structure which provides stable pricing under 20-year contracts. We generally sell our European, Asian and Canadian projects to investors after they are constructed. In certain countries, for example, in India and South Africa, there is a multi-year holding requirement for a portion of our equity position in such projects. In the United States, we frequently utilize a sale-leaseback financing structure which results in booking electricity generation and sale revenue. For many projects, we generally operate solar energy systems after construction pursuant to predefined operations and maintenance agreements. Our long-term corporate objective is to lower the levelized cost of solar energy to the point that solar electricity is cost competitive with fossil fuel generated electricity, enabling us to reach grid parity with traditional energy alternatives without government incentives or subsidies. We also intend to leverage our customer relationships and on-site customer presence to obtain additional power purchase agreements for new locations and long-term contracts for operations and maintenance services for non-SunEdison solar energy systems.

Our portfolio of solar power generation assets that we have sold and then leased back generates revenue in the U.S. from the sale of electricity pursuant to long-term, typically 20-year, solar power services agreements and the receipt and sale of renewable energy incentives, including renewable energy credits ("RECs"), which we sell to third parties. In the State of California, we may also receive performance based incentives ("PBIs") from public utilities, under certain state-wide solar incentive programs.

Through electricity generation by solar electric systems that SunEdison operates in certain states in the U.S., including Maryland, New Jersey, California, Ohio and Colorado, SunEdison is credited with one REC for each 1,000 kilowatt-hour (or megawatt-hour) of electricity we produce. RECs represent the right to claim the environmental, social and other non-power qualities of the renewable electricity generation. At the appropriate time in construction of a solar power plant, SunEdison submits an application to the relevant state energy regulatory bodies. The solar power plant is inspected and if approved, SunEdison is qualified to receive RECs based on actual production in the future. A REC, and its associated attributes and benefits, can be sold with or separately from the underlying physical electricity associated with a renewable-based generation source. Buyers of these certificates are typically the utilities that can use the credits to offset state or public utility commission mandated environmental obligations that specify that a portion of their electricity must be generated by solar energy. Whenever possible, SunEdison enters into multi-year binding contractual arrangements with utility companies or other investors who purchase RECs at fixed rates. Sales directly to utilities are generally recorded at the time the required level of energy is generated, which in turn gives SunEdison the right to the REC. SunEdison typically has the legal and contractual right to transfer ownership of the REC to a third party under the terms of an agreement between SunEdison and the utility. Investors also purchase these certificates, typically under similar contracts. These investors then resell the certificates to end-user utilities or other companies.

In the event of under production of energy versus the contracted volume or inability to secure state validation, SunEdison may be required to purchase RECs on the spot market and transfer them to the contracted counterparty.

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Based on our operating experience, we believe that it is unlikely that SunEdison would be required to purchase a material amount of RECs to satisfy potential future contractual shortfalls.

SunEdison also receives renewable energy incentives from public utilities in the State of California in the form of PBIs under the California Solar Initiative ("CSI") program for the production of renewable energy. A fixed rate per kilowatt hour of actual solar energy production is paid in cash by the utilities over a 60 month period, and the incentive is not based or calculated on the cost to construct the solar power plant. The PBIs are not earned by SunEdison unless production actually occurs. There is no penalty under the PBI program if there is no electricity production. Production from SunEdison-operated systems is verified by an independent third party before billing to the utilities. Unlike RECs discussed above, PBIs are merely a cash incentive and are not tradable.

Suppliers and Raw Materials. For our SunEdison business, we procure modules through our OEM manufacturing relationships and also have a limited number of suppliers for modules, trackers and inverters. We generally enter into purchase agreements with one year terms with these suppliers. We believe this allows us to optimize system performance, reduce system costs and benefit from the long-term innovation and cost reduction trends of the solar industry. We also have a limited number of engineering, procurement and construction providers. Our solar module suppliers generally provide a 25-year limited warranty for power and a multi-year limited warranty for workmanship. We provide a similar warranty for our solar modules that we supply to our own solar energy projects or to third party purchasers of such modules. Inverter suppliers generally provide a product workmanship warranty of five years with available extended warranties if purchased. In the event that a module or inverter fails in the future, we will repair or replace the failed module or inverter and then look to the supplier for compensation. We have also entered into OEM module production arrangements to strengthen our supply chain and provide lower cost modules for use in our SunEdison business.

For our solar wafer production, the main raw material is polysilicon. We use two types of polysilicon: granular polysilicon and chunk polysilicon. We produce all of our requirements for granular polysilicon at our facility in Pasadena, Texas. Although we have produced chunk polysilicon in our Merano, Italy facility, we shuttered that facility in December 2011 as part of the 2011 Global Plan, and although we have made significant progress in 2012, it will remain shuttered unless dramatic feedstock, power and other cost reductions are achieved in the near term. We are now buying chunk polysilicon pursuant to short- to medium-term agreements with other polysilicon manufacturers. Chunk polysilicon can be substituted for granular polysilicon, although our manufacturing throughput and yields could be adversely affected.

In February 2011, we announced the formation of a joint venture with Samsung Fine Chemicals Co. Ltd. to produce high purity granular polysilicon to meet some of our internal polysilicon needs. We believe our ability to meet most of our polysilicon requirements through our in-house capabilities provides us with a potential advantage to compete more effectively. We obtain our requirements for several raw materials, equipment, parts and supplies for solar wafer manufacturing from some sole suppliers.

Our solar wafers are used as the starting material for crystalline solar cells. Customers using crystalline wafers for solar applications utilize wafers that are square or pseudo square so that they fit optimally into solar modules (panels) and convert energy from the sun into usable electrical energy. Our first solar wafer manufacturing facility was constructed in Kuching, Malaysia and brought online in 2010. Also in 2010, we acquired Solaicx, which gave us a monocrystalline wafer manufacturing facility in Portland, Oregon. We will continue to manufacture solar wafers in both Kuching and Portland as well as through our joint venture in China with Zhenjiang Huantai Science & Technology Co. Ltd. We will also continue to use subcontractors for a limited amount of our solar wafer production.

Sales, Marketing and Customers. SunEdison markets its solar energy generation, monitoring and maintenance services primarily through a direct sales force, and also through local or regional solar channel partners both domestically and internationally. A key element of our sales and marketing strategy is establishing and maintaining close relationships with our customers. We accomplish this through multi-functional teams of marketing, sales, technical, project finance and legal personnel.

Domestic Marketing and U.S. Customers. Our U.S. solar energy customers fall into three categories: (i) commercial customers, which principally include large, national retail chains and real estate property management firms; (ii) federal, state and municipal governments; and (iii) utilities.

For our commercial customers, our business model centers on entering into long-term power purchase agreements where our customers purchase electricity at a pre-determined price for an extended period of time, which may be up to 20 years. Under these arrangements, we generally agree to sell, and the customer agrees to buy, all of the electricity produced by a solar energy system which is installed on the rooftops of their stores or on their other property. We

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structure these contracts so that the customer pays us a price per kilowatt hour that is competitive with the price charged by the customer’s local electric utility. Our commercial customers are primarily large companies that operate on a national or regional basis. These customers have certain attributes that make them good candidates for our services, such as multiple locations with large rooftops or unused land, strong credit quality, large electricity consumption requirements and appropriate load usage.

Our approach to government customers is similar to that with commercial customers. Government customers also purchase power under long-term power purchase agreements; however, our government customers generally tend to be interested in single large solar energy systems rather than systems at multiple locations. Our solar energy services provide several benefits tailored to government customers, including helping them to achieve renewable energy mandates and allowing them to benefit from solar tax incentives for which they would not otherwise qualify.

We typically enter into two kinds of agreements with utility customers—long-term power purchase agreements and agreements to sell RECs. Our power purchase agreements, similar to our agreements with commercial and government customers, provide for the sale of electricity to the utility at a contracted price, typically over a 20-year term. The benefits to our utility customers of entering into a power purchase agreement with us include: (i) our solar energy systems allow utilities to satisfy increasing interest by their customers and regulators in purchasing electricity generated by solar and other renewable energy sources; (ii) our distributed generation system can help utilities balance grid electricity demands and meet their ongoing generation, transmission and distribution requirements in order to supply electricity to their end-customers, while avoiding expensive and potentially difficult new generation, transmission and distribution investment and construction; and (iii) because the pricing of the electricity generated by our solar energy systems takes into account all available federal and state tax incentives, which certain not-for-profit utilities are not entitled to benefit from directly, our solar energy systems offer utilities a mechanism through which to indirectly benefit from these tax incentives. We sell RECs that are generated by our solar energy systems to utilities to assist them in complying with their renewable energy regulatory requirements that require them to produce a specified percentage of their electricity from renewable energy sources.

International Marketing and Foreign Customers. Until recently, SunEdison’s international business operations have focused only in certain areas in Europe and Canada. Our growth in 2010 primarily reflected an increase in ground mount projects in Italy. Our growth in 2011 and 2012 was primarily from an increase in utility projects in North America, and we expect our 2013 growth similarly to be focused in North America while also diversifying into South Africa and South America. We believe this regional and market diversification will reduce country concentration risk and improve overall project returns.

In our international operations, we either develop projects ourselves or enter into strategic alliances or partnership arrangements with local project developers with extensive knowledge of the local licensing, permitting, land siting and other legal aspects of developing a solar energy system in each given country or region. Under these arrangements, our local partners generally obtain the necessary permits, authorizations, licenses and land rights for the development of the solar energy system, and we manage the engineering, construction, procurement, installation and financing of the solar energy system. We also may execute an operations and maintenance agreement to service the system for an extended period of time after construction.

Project Finance and Project Working Capital. Our SunEdison business model is to realize cash upon the completion of a solar energy system and the sale of the system or, in the event of a sale-leaseback financing or project that we elect to retain on our balance sheet, during the term of any related power purchase agreement. Typically, a construction financing facility is implemented prior to commencement of construction of the solar energy system, and for non-sale leaseback financed projects, long-term debt is arranged prior to commercial operation of the system and drawn on at or about the time of commercial operation or the sale of the system.

We utilize a variety of project- and debt-financing structures to arrange long-term financing for our systems, including non-recourse construction finance. In the United States, our long-term financing primarily consists of selling the solar energy system to a third-party and leasing it back for an extended period of time. These leases are typically accounted for as capital leases or financing arrangements on our balance sheet. See Note 2 to Notes to Consolidated Financial Statements. Outside the U.S., we typically obtain term debt financing with a maturity date tied to the date the applicable feed-in tariff expires, and upon the sale of these systems, the new project owner acquires the term debt financing. Alternatively, in lieu of financing solar energy systems, we may choose to sell a portion of our systems portfolio to third parties. Outside the U.S., we generally sell projects outright to third parties, except in India and in South Africa where there is a partial equity holding requirement. Our currently known or anticipated market and liquidity risks are described more fully in "Item 1A. Risk Factors", below, and "Management's Discussion and Analysis

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of Financial Condition and Results of Operations-Liquidity and Capital Resources" in our 2012 Annual Report, which is incorporated by this reference into this Form 10-K.

Operations and Maintenance of Solar Energy Systems. Our service personnel are responsible for the operation and maintenance of our portfolio of solar energy systems. We may also provide operations and maintenance services to solar energy systems that are neither owned nor installed by us. In 2013, we are planning to expand our operations and maintenance business significantly through organic and inorganic growth. The services provided by our service team include the following:

• Solar Monitoring. Our renewable operations center provides monitoring of solar energy systems and measures output in 15-minute increments. This enables us to dispatch repair crews as needed based on system performance and conditions. Our customers are also able to access the data for their system remotely through our online customer portal. With the SunEdison Energy & Environmental Data System ("SEEDS"), our equipment and proprietary software platform used for remote monitoring and control of solar power plants, we are able to measure production, create customized reports, streamline billing and ensure efficient operation and maintenance.

• Optimal Solar Production. Our service contracts cover preventative maintenance to ensure the optimal level of performance and electrical generation for the solar energy system.

Competition. The solar power market in general competes with conventional fossil fuels supplied by utilities and other sources of renewable energy such as wind, hydro, biomass, concentrated solar power and emerging distributed generation technologies such as micro-turbines and fuel cells. Furthermore, the market for solar electric power technologies is competitive and continually evolving. We believe our major competitors in the solar energy services provider market include SunPower Corporation, First Solar, Inc., Enerparc, Sharp Corporation (Recurrent Energy), Phoenix Solar, BELECTRIC, JUWI Solar Gmbh and Solar City. We may also face competition from solar cell and module suppliers, who may develop solar energy system projects internally that compete with our product and service offerings, or who may enter into strategic relationships with or acquire other existing solar power system providers. We also compete to obtain limited government funding, subsidies or credits. In the large-scale on-grid solar power systems market, we face direct competition from a number of companies, including those that manufacture, distribute or install solar power systems, as well as construction companies that have expanded into the renewable sector and independent power producers. In addition, we will occasionally compete with distributed generation equipment suppliers.

We generally compete on the basis of the price of electricity we can offer to our customers; our experience in installing high quality solar energy systems that are generally free from system interruption and that preserve the integrity of our customers’ properties; our continuing long-term solar services (operations and maintenance services) and the scope of our system monitoring and control services; quality and reliability; and our ability to serve customers in multiple jurisdictions.

Seasonality. Our quarterly revenue and operating results for solar energy system installations are difficult to predict and have in the past and may in the future fluctuate from quarter to quarter due to changes in subsidies, as well as weather, economic trends and other factors. For example, in Canada and in European countries with feed-in tariffs, the construction of solar power systems may be concentrated during the second half of the calendar year, largely due to periodic reductions of the applicable minimum feed-in tariff and the fact that the coldest winter months are January through March, which impacts the extent (or amount) of construction that occurs. In the United States, customers or investors will sometimes make purchasing decisions towards the end of the year in order to take advantage of tax credits or for other budgetary reasons.

Regulation

Our SunEdison business is exempt from most regulation applicable to electric utilities under applicable national, state or other local regulatory regimes where SunEdison conducts business. In the United States, SunEdison owns or controls solar energy facilities that are certified as "Qualifying Small Power Production Facilities" ("QFs") under the Public Utility Regulatory Policy Act of 1978 or "Exempt Wholesale Generators" ("EWGs") under the Public Utility Holding Company Act of 2005. As a result, SunEdison's solar energy projects are exempt from most regulations established by the Federal Energy Regulatory Commission ("FERC"). These exemptions apply to the regulation of rates of interstate sales of wholesale electricity, and otherwise to federal and state laws regarding the financial and organizational regulation of electric utilities. For some of SunEdison's large utility-scale projects, the utility that is purchasing the energy must seek state regulatory approval of its power purchase agreements entered into with

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SunEdison. As SunEdison's utility-scale business grows to entail interstate sales of wholesale electricity from solar energy facilities greater than 20MW, those facilities may no longer be eligible for exemption from the ratemaking provisions of the Federal Power Act, and, as a result, will need to seek and obtain "market-based rate authorization" from FERC in order to undertake wholesale sales of power. A facility with “market-based rate authorization” from FERC is regulated as a "public utility", provided that, as certified QFs, each solar energy facility will continue to be exempt from most other federal and state regulation as long as they do not exceed 30MW. SunEdison's solar energy facilities are subject to compliance with the mandatory reliability standards developed by the North American Electric Reliability Corporation and approved by FERC under the Federal Power Act. In Europe, Asia and Canada, SunEdison and its subsidiaries are also generally subject to the regulations of the relevant energy regulatory agencies applicable to all producers of electricity under the relevant feed-in tariff regulations (including the feed-in tariff rates).

Additionally, interconnection agreements are required for virtually all of SunEdison's projects. Depending on the size of the system and state law requirements, interconnection agreements are between the local utility and either SunEdison or its customer in the United States. In almost all cases, interconnection agreements are standard form agreements that have been pre-approved by FERC, the local public utility commission ("PUC") or other regulatory body with jurisdiction over interconnection agreements.

Research and Development

Semiconductor Materials. The semiconductor wafer market is characterized by continuous technological development and product innovation. We believe that continued and timely development of new products and enhancements to existing products is necessary to maintain our competitive position. Our goal in research and development is to maintain a close working relationship with our customers to continually develop new products and refine existing products to meet the needs of the marketplace. Our research and development model combines engineering innovation with specific commercialization strategies. Our model closely aligns our technology efforts with our customers’ requirements for new applications. We accomplish this through a better understanding of our customers’ technology requirements and through targeted research and development projects aimed at developing products to meet those technology requirements and applications. Some of these projects involve formal and informal joint development efforts with our customers.

In addition, in order to strengthen our customer relationships, we assign research and development engineers to key customers worldwide. We do this through our Applications Engineering Group. The primary purpose of the Applications Engineering Group is to establish a close, technical working relationship with our customers to obtain a better knowledge of our customers' materials requirements.

We devote a portion of our research and development resources to enhance our position in the crystal technology area. We have dedicated engineers and scientists, located in our St. Peters, Missouri, Merano, Italy, Hsinchu City, Taiwan and Chonan, South Korea facilities, to further our understanding of defect control and cost reduction. In conjunction with these efforts, we are developing wafering technologies to meet advanced flatness and particle requirements of our customers, and we continue to focus on the development of our advanced epitaxial wafer technology with a dedicated staff of scientists located primarily in our St. Peters, Missouri, Novara, Italy, Hsinchu City, Taiwan and Utsunomiya, Japan facilities, who focus on the development of new epitaxial wafer products and cost reduction processes. We also have dedicated engineers, scientist and technicians located in St. Peters, Missouri facility to support SOI wafer requirements of our customers.

In addition to our focus on advancements in wafer material properties, we also continue to invest in research and development associated with larger wafer sizes. We produced our first 300 millimeter wafer in 1991 and continue to enhance our 300 millimeter technology program using our staff of research and development scientists, engineers and technicians. In addition, we continue to focus on process design advancements to drive cost reductions and productivity improvements. We produced our first 450 millimeter wafer in 2008, but to date have only produced minimal quantities of wafers at this size.

Solar Energy. The solar wafer market is characterized by intense cost pressures, excessive supply, competition from thin film technologies and geopolitical trade dynamics. These intense cost pressures and worldwide overcapacity led us to commit to our December 2011 restructuring actions reflected in the 2011 Global Plan.  We believe that the timely development of higher productivity and lower cost processes, enhancements to the existing products, and development of new wafer products are essential to maintain our competitive position and to provide lower cost modules to our SunEdison projects. Our goal in solar materials research and development is to continually evaluate the cost and quality at the installed power system level to develop products capable of enhancing overall value for the end consumer while meeting the performance requirements necessary to grow the solar market. We accomplish this by closely linking

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our research and development projects and goals to the current and future technology requirements across the solar value chain. Some of these projects involve formal and informal joint development efforts with our customers.

In the upstream solar materials value chain, we devote research and development resources in the areas of polysilicon production, crystallization, crystal wafering and solar cells and modules. We have a dedicated group of engineers and scientists, working in our St. Peters, Missouri, Pasadena, Texas, and Merano, Italy facilities, to develop higher productivity, lower cost and ultrapure polysilicon fabrication processes. In conjunction with these efforts, we are developing efficient crystal growth processes to produce high quality multicrystalline and monocrystalline silicon with lower defect density and higher minority carrier lifetime, using a team of engineers and scientists located primarily in our St. Peters, Missouri, Portland, Oregon and Kuching, Malaysia facilities. With our acquisition of Solaicx, we have a proprietary continuous crystal growth manufacturing technology which yields high-efficiency monocrystalline silicon wafers. The research and development efforts in crystal wafering are directed towards reducing silicon wafer thickness and kerf loss, improving the wafer quality, reducing the overall cost while improving the energy output of the solar modules derived from the silicon wafer, and achieving technological differentiation and innovation. We are developing wafering technologies that enable scaling to smaller wafer thickness while increasing the productivity of the wafering process. We are also continuing to develop our own solar wafer (156 millimeter) manufacturing facility in Kuching, Malaysia, although this capacity ramp has been limited. These efforts focus on simultaneously reducing cost and improving energy output at the module and system level. We achieve this synergy by conducting necessary complementary research and development  in solar cells and modules. Our module and solar cell research and development teams are primarily located in Beltsville, Maryland and Belmont, California. In addition, we have research and development resources in India (design) and Singapore (quality).

Moreover, we work with key customers worldwide through our Product Development/Management and research and development engineers, leveraging our research and development laboratories. This enables us to establish a close, technical working relationships with our customers to obtain a better knowledge of our customers' solar materials requirements.

The Product Development and Product Management Groups for our downstream Solar Energy business unit are also focused on reducing the levelized cost of electricity in our photovoltaic installations. As a solar energy services provider, new technology evaluation is a critical part of this effort. The Product Development and Management Groups evaluate emerging industry solutions in the areas of module, inverter and balance of systems components. Technology evaluation is pursued through analysis, testing, demonstration and development. SunEdison became a founding member of the Solar Technology Acceleration Center in Aurora, Colorado in 2008 in order to further this effort. The other founding partners include Xcel Energy and Abengoa Solar. Sponsoring partners include the National Renewable Energy Lab and the Electric Power Research Institute. In addition to external technology evaluation, the Product Development Group leads efforts to reduce the levelized cost of electricity through internal product development of system components, with particular emphasis on module mounting components. The energy research and development team also focuses on providing platform solutions integrating data collection, analysis and optimization on the foundation of proprietary hardware and software.

The Solar Energy Product Development Group also leads a cross functional continuous improvement process within the company to analyze and improve the performance of SunEdison's operational solar energy systems. This effort focuses on propagating best practices, increasing energy production and minimizing the frequency and impact of system outages. Through these combined efforts, SunEdison strives to reduce the cost of electricity delivered to our customers while improving the quality and reliability of our systems throughout their operational life.

Proprietary Information and Intellectual Property

We believe that the success of our business depends in part on our proprietary technology, information, processes and know how. We protect our intellectual property rights based on patents and trade secrets. As of December 31, 2012, we had approximately 270 U.S. patents, of which approximately 70 will expire within the next five years, approximately 125 will expire between six and ten years, and approximately 75 will expire after ten years. As of December 31, 2012, we had approximately 490 foreign patents, of which approximately 60 will expire within the next five years, approximately 310 will expire between six and ten years, and approximately 120 will expire after ten years. These foreign patents are generally counterparts of our U.S. patents. As of December 31, 2012, we had approximately 200 pending U.S. patent applications and approximately 450 pending foreign patent applications. The patents we beneficially own relate to polysilicon technology. We exclusively licensed these beneficially owned patents from Albemarle Corporation in connection with our purchase of Albemarle's granular polysilicon business in 1995. We may request that these patents be assigned to us at any time in exchange for a nominal purchase price.

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We have agreed to indemnify some of our customers against claims of infringement of the intellectual property rights of others in our sales contracts with these customers. Historically, we have not paid any claims under these indemnification obligations, and we do not have any pending indemnification claims against us.

Customer Concentration

In 2012, no single customer accounted for more than 10% of our 2012 consolidated net sales.

Employees

At December 31, 2012, we had approximately 5,630 full time employees and approximately 380 contract or temporary workers worldwide. We have approximately 1,700 unionized employees in our facilities located in St. Peters, Missouri, Pasadena, Texas, South Korea, Italy and Japan. We have not experienced any material work stoppages at any of our facilities due to labor union activities during the last several years. We believe our relations with our employees are generally good.

Geographic Information

Information regarding our foreign and domestic operations is contained in Note 20, "Reportable Segments," of Notes to Consolidated Financial Statements included in our 2012 Annual Report, which information is incorporated herein by reference.

Available Information

We make available free of charge through our website (http://www.memc.com) reports we file with the Securities and Exchange Commission ("SEC"), including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The SEC maintains an internet site containing these reports and proxy and information statements at http://www.sec.gov. Any materials we file can be read and copied online at that site or at the SEC's Public Reference Room at 100 F Street, NE, Washington DC 20549, on official business days during the hours of 10:00 am and 3:00 pm. Information on the operation of the Public Reference Room can be obtained by calling the SEC at 1-800-SEC-0330.

Item 1A. Risk Factors

Risks Related to Demand for Our Products and Services

Due to the general economic environment and other factors, we may be unable to generate sufficient cash flows or obtain access to external financing necessary to fund our operations.

In recent years, the European, U.S. and world economies have undergone significant turmoil amid stock market volatility, difficulties in the financial services sector, tightening of the credit markets, softness in the housing markets, concerns of inflation and deflation, reduced corporate profits and capital spending, reduced consumer spending and various other economic difficulties. This recent turmoil demonstrates how uncertain future economic conditions are and those conditions could negatively impact our ability to obtain debt or equity project financing required for the construction and sale of solar power plants. Additionally, access to capital markets continues to be challenging, especially in Europe. If the slow improvement in market and economic conditions does not continue or turmoil and volatility significantly increase, we may be further limited in our ability to access the capital markets to meet liquidity and operational and capital expenditure requirements. We may not have sufficient resources to support our business plan, and there can be no assurance that liquidity will be adequate over time. There can be no assurance that we will be able to generate sufficient cash flows, find other sources of capital or access capital markets, and if adequate funds and alternative resources are not available on acceptable terms, our ability to fund our operations, develop and construct solar power plants, maintain our research and development efforts, provide collateral for our projects or otherwise respond to competitive pressures would be significantly impaired. Our inability to do the foregoing could have a material adverse effect on our business and results of operations.

We make significant investments in building our solar energy projects, and the delayed sale of our projects or the inability to sell our projects would adversely affect our business, liquidity and results of operations.

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The development and construction of solar power plants can require long periods of time and substantial initial capital investments, and there are significant risks related to the development of solar power plants, including high initial capital expenditure costs to develop and construct functional power plant facilities and the related need for construction capital, the availability of favorable government tax and other incentives, the high cost and potential regulatory and technical difficulties in integrating into new markets, an often limited or unstable marketplace, competition from other sources of electric power, regulatory difficulties including obtaining necessary permits, difficulties in negotiating power purchase agreements with potential customers, educating the market regarding the reliability and benefits of solar energy products and services, costs associated with environmental regulatory compliance and competing with larger, more established solar energy companies and utilities. There can be no assurance that we will be able to overcome these risks as we develop our solar power projects and energy services business. There can also be no assurance that a potential project sale can be completed on commercially reasonable terms or at all. Our potential inability to obtain regulatory clearance, project financing or enter into sales contracts with customers could adversely affect our business, liquidity and results of operations. Our liquidity could also be adversely impacted if project sales are delayed.

We anticipate that the SunEdison business will continue to require significant amounts of working capital and other capital. In addition, we plan to make continued investment in the SunEdison business to expand this business in the near future. Historically, the SunEdison business has generated U.S. GAAP operating losses as SunEdison has ramped up its operations. There can be no assurance that the SunEdison business will produce sufficient margins in the future to support the capital required for its operations.

If we are unable to enter into new financing agreements when needed, or upon desirable terms, for the construction and installation of our solar energy systems, or if any of our current financing partners discontinue or materially change the financing terms for our systems, we may be unable to finance our projects or our borrowing costs could increase, which would have a material adverse effect on our business, financial condition and results of operations.

We typically rely on working capital and credit facilities to fund the up-front costs associated with the design, construction and installation of our solar energy systems and the purchase of components, such as solar modules and inverters, for our systems. In addition, we secure long-term financing upon completion of our solar energy systems for those systems we retain and use the proceeds to refinance the debt incurred for the design, construction and installation of the solar energy systems, as well as to generate profits and cash flow for our business. Without access to sufficient and appropriate financing, or if that financing is not available at desirable rates or on terms we deem appropriate, we would be unable to grow our SunEdison business by increasing the number of solar energy systems we are simultaneously developing. Our ability to obtain additional financing in the future depends on banks' and other financing sources' continued confidence in our business model and the renewable energy industry as a whole. Solar energy has yet to reach widespread market penetration and is dependent on continued support in the form of performance-based incentives, rebates, tax credits, feed-in tariffs and other incentives from federal, state and foreign governments. If this support were to dissipate, our ability to obtain external financing on acceptable terms, or at all, could be materially adversely affected. While we have solar project financing available to us through existing relationships and facilities, our current cash and financing sources may be inadequate to support the anticipated growth in our business plans. Additionally, in 2012, our corporate family rating and our 2019 Notes rating were both downgraded by ratings agencies, as discussed in "Risks Related to Our Indebtedness" below, which limited our access to the non-recourse construction facility, resulting in an amendment to such facility in the second quarter of 2012. Any additional downgrades in the future may limit or restrict in the future our ability to borrow under certain current credit facilities or to secure new or additional credit facilities, and may increase the costs of borrowing, increase letter of credit requirements for our solar energy projects and subject us to more onerous debt covenants. In addition, we do not currently have any dedicated financing in some of our emerging and international markets, and obtaining financing in these new markets will present challenges. Our failure to obtain necessary financing to fund our operations would materially adversely affect our business, financial condition and results of operations.

To date, we have obtained financing for our SunEdison business from a limited number of financial institutions. If any of these financial institutions decided not to continue financing our solar energy systems as a result of a ratings downgrade or otherwise, or materially changed the terms under which they are willing to provide financing, we could be required to identify new financial institutions and negotiate new financing documentation. The process of identifying new financing partners and agreeing on all relevant business and legal terms could be lengthy and could require us to reduce the rate of the growth of our business until such new financing arrangements were in place. In addition, there can be no assurance that the terms of the financing provided by a new financial institution would compare favorably with the terms available from our current financing partners. Our inability to secure financing could lead to canceled projects, or reduced deal flow, or we could be forced to finance the construction and installation of solar energy systems ourselves. In any such case, our borrowing costs could increase, which would have a material adverse effect on our business, financial condition and results of operations.

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We may be unable to obtain favorable financing from our vendors and suppliers, which could have a material adverse effect on our business, financial condition and results of operations.

We have historically utilized financing from our vendors and suppliers through customary trade payables or account payables. At times, we have also increased the number of days' payables outstanding. There can be no assurance that our vendors and suppliers will continue to allow us to maintain existing or planned payables balances, and if we were forced to reduce our payables balances below our planned levels, without obtaining alternative financing, our inability to fund our operations would materially adversely affect our business, financial condition and results of operations.

Our solar wafer business experienced a substantial and sustained decline in prices which has had, and could continue to have, a material adverse effect on our business, financial condition or results of operations.

According to independent sources, industry-wide solar wafer pricing fell approximately 40% during the second quarter of 2011. During the third and fourth quarters of 2011, solar wafer pricing continued to decline due to the market downturn. In 2012, solar wafer pricing fell approximately 35% due to excess capacity in the industry. Solar wafer pricing has also been affected by the unfair trade complaints as discussed in depth in the risk factor below. These price decreases had a significant unfavorable impact on our revenue and gross margins during the years ended December 31, 2011 and 2012, and, though we are largely eliminating future external solar wafer sales, may unfavorably impact future operating results in our Solar Energy business. When selling prices decline, our net sales and gross profit also decline unless we are able to sell more products or reduce the cost to manufacture our products. If the selling prices for our products continue to decline, our operating results could be materially adversely affected. Failure to successfully address the challenges facing this business may hinder or prevent our ability to achieve our business objectives in a timely manner, and may also result in less than full recovery of our remaining Solar Energy long-lived assets, which could require further significant asset write-downs.

Historically we have made significant investments in our solar energy project pipeline, including both organically developing and acquiring projects from third-parties, and if a number of projects in our pipeline fail to proceed to construction or are not completed, our business, financial condition or operating results could be materially adversely affected.

The solar project development process is long and includes many steps involving site selection and development, commercial contracting and regulatory approval, among other factors.  As of December 31, 2012, SunEdison had 2.6 gigawatts ("GW") in pipeline, of which 73MW was under construction at that time. There can be no assurance that pipeline will be converted into completed projects or generate revenues or that we can obtain the necessary financing to construct these projects. As we develop pipeline organically or through acquisitions, some of the projects in our pipeline may not be completed or proceed to construction as a result of various factors.  These factors may include changes in applicable laws and regulations, including government incentives, environmental concerns regarding a project or changes in the economics or ability to finance a particular project.  If a number of projects are not completed, our business, financial condition or operating results could be materially adversely affected.

Our Solar Energy business depends on the solar industry, which is driven largely by the availability and size of government and economic incentives which could be reduced or eliminated, resulting in decreased demand for our solar wafers and SunEdison’s services, which could have significant negative effects on our business, financial condition or results of operations.

Today's solar industry demand continues to be mainly driven by the availability and size of government and economic incentives related to the use of solar power, because today the cost of solar power exceeds the cost of power furnished by the electric utility grid in most locations. As a result, government bodies in many countries have historically provided incentives in the form of feed-in-tariffs to solar project developers to promote the use of solar energy in on-grid applications and to reduce dependency on other forms of energy. In addition, we rely upon income tax credits and other state incentives in the United States for solar energy systems. Most countries have continued to regularly reduce the rates paid to solar power system owners for generating electricity under their respective feed-in-tariff programs, and these regular, scheduled reductions in feed-in tariff rates are expected to continue. Moreover, the value and pricing of PBIs and RECs, as well as the state PUC approved PPA rates for utilities (which are frequently higher than electricity rates for electricity generated from other energy sources), are likely to continue to decrease, further reducing the U.S. revenue stream from solar projects. These government economic incentives could be further reduced or eliminated altogether, especially in light of ongoing worldwide economic troubles and slow recovery. In addition, some of these solar program incentives expire, decline over time, are limited in total funding or require renewal of authority. Finally, some countries could alter their programs retroactively which would impact our systems currently in place. Reductions in, or eliminations or expirations of, governmental incentives could result in decreased demand for our wafers, our customers’ products and our solar energy systems, which could have a material adverse effect on our business, financial condition or results of operations.

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Our Semiconductor Materials business depends on the semiconductor device industry, and when that industry experiences a downturn, our sales could decrease, and we could be forced to further reduce our prices while maintaining fixed costs, all of which could have significant negative effects on our operating results and financial condition.

Our Semiconductor Materials business depends in large part upon the market demand for our customers’ semiconductor devices that are utilized in electronics applications. The semiconductor device industry experiences:

• rapid technological change;

• product obsolescence;

• changes in product mix;

• price erosion; and

• fluctuations in product supply and demand, some of which fluctuations can be severe.

From time to time, the semiconductor device industry has experienced significant downturns. These downturns often occur in connection with declines in general economic conditions. In the second half of 2011, demand for wafers for semiconductor applications started to slow down and dropped by approximately 15% in the fourth quarter as compared to the third quarter according to SEMI (the industry association serving the manufacturing supply chains for the microelectronic and photovoltaic industries), and although demand increased during the first quarter of 2012, it dropped again during the second half of 2012. Accordingly, demand for our semiconductor wafers was down during this period. If the semiconductor device industry experiences future downturns, or if the current downturn lingers, we will face pressure to further reduce prices, and we may need to further rationalize capacity and reduce fixed costs. If we are unable to reduce our expenses sufficiently to offset reductions in price and volume, our operating results and financial condition will be materially adversely affected.

A continued excess of polysilicon supply could adversely affect sales of our solar wafers, forcing us to further reduce prices in order to maintain or gain market share, which could have a material adverse effect on our business, financial condition or results of operations.

Both new available polysilicon supply and solar wafer supply capacity have led to an excess supply of available material. This oversupply of polysilicon and solar wafers has led to significantly lower solar wafer pricing in 2011, throughout 2012 and, we expect, into 2013. In the past we have agreed to price reductions with some of our customers, including customers with whom we have long-term supply agreements, and we may need to do so again in the future, which could have a material adverse effect on our business, financial condition or results of operations.

The timing of completion of projects in our SunEdison business fluctuates, which could have a material adverse effect on our business, financial condition or results of operations or the market price of our common stock.

Our quarterly results of operations fluctuate significantly based on the timing of SunEdison projects, with a significant portion of revenues recognized during the fourth quarter of each year. There are various reasons for these fluctuations, mostly related to economic incentives and weather patterns. For example, in Canada and in European countries with feed-in tariffs, the construction of solar power systems may be concentrated during the second half of the calendar year, largely due to periodic reductions of the applicable minimum feed-in tariff and the fact that the coldest winter months are January through March, which impacts the amount of construction that occurs. In the United States, customers will sometimes make purchasing decisions towards the end of the year in order to take advantage of tax credits or for other budgetary reasons. If we fail to adequately manage the fluctuations in the timing of our SunEdison projects, our business, financial condition or results of operations could be materially affected.

Existing regulations and policies governing the electric utility industry, as well as changes to these regulations and policies, may adversely affect demand for our Solar Energy products and services and materially adversely affect our business, financial condition and results of operations.

The market for electricity generation is heavily influenced by federal, state and local government regulations and policies concerning the electric utility industry, as well as policies promulgated by public utility commissions and electric utilities. These regulations and policies govern, among other matters, electricity pricing and the technical interconnection of distributed electricity generation to the grid. The regulations and policies also regulate net metering, which relates to the ability to offset utility-generated electricity consumption by feeding electricity produced by renewable energy sources, such as solar energy, back into the grid. Utility customer purchases of alternative energy, including solar energy, could be deterred by these regulations and policies, which could result in a significant reduction in the potential demand for our solar energy systems and solar wafers. Changes in consumer electricity tariffs or peak hour pricing policies of utilities, including the introduction of fixed

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price policies, could also reduce or eliminate the cost savings derived from solar energy systems and, as a result, reduce our customer demand for our systems.

Certain power purchase agreements signed in connection with SunEdison's utility-scale business are subject to public utility commission approval, and such approval may not be obtained or may be delayed.

As a solar energy provider in the U.S., the power purchase agreements executed by SunEdison and/or its subsidiaries in connection with the development of utility-scale projects are generally subject to approval by the applicable state PUC.  It cannot be assured that such PUC approval will be obtained, and in certain markets, including California and Nevada, the PUCs have recently demonstrated a heightened level of scrutiny on solar power purchase agreements that have come before the PUC for approval. If the required PUC approval is not obtained for any particular solar power purchase agreement, the utility counterparty may exercise its right to terminate such power purchase agreement, and SunEdison may lose its invested development capital.

If we fail to meet changing customer demands, we may lose customers and our sales could suffer.

The two industries in which we operate change rapidly. Changes in our customers' requirements result in new and more demanding technologies, product specifications and sizes, and manufacturing processes. Our ability to remain competitive will depend upon our ability to develop technologically advanced products and processes. We must continue to meet the increasingly demanding requirements of our customers on a cost-effective basis. As a result, we expect to continue to make significant investments in research and development. We cannot be certain that we will be able to successfully introduce, market and cost-effectively manufacture any new products, or that we will be able to develop new or enhanced products and processes that satisfy customer needs or achieve market acceptance.

Risks Related to Our Supply Chain and Supply Channels

Significant payments required from us under take-or-pay contracts could have a material adverse effect on our business, financial condition or results of operations.

We have long-term annual take-or-pay contracts with certain suppliers of precursor raw materials and solar wafers.  If we fail to take the required minimum annual amounts under those contracts, we would be required to make payments to the relevant suppliers and those payments could be significant.  In previous years, we have made significant payments to such suppliers because we did not take the required minimum volumes under those agreements, and we could have to make significant payments in the future if we do not take the required minimum annual amounts under those contracts.

In addition, the 2011 Global Plan necessitated termination of certain take-or-pay contracts with some of our suppliers of raw materials and solar wafers, which gave rise to disputes with those parties.  We entered into a settlement with one party, Evonik, resulting in our forfeiture of a $10.2 million deposit and an agreement by us to pay Evonik a total of 70 million euro.  We may be required to make additional material payments in connection with the termination of other such contracts, including payments larger than management's current estimates of such obligations.  These additional payments, if required in 2013 and future years, could have a material adverse effect on our business, cash flows, financial condition or results of operations.  See Note 19 to Notes to Consolidated Financial Statements. 

Our dependence on single and limited source suppliers and subcontractors in our Semiconductor Materials and Solar Energy businesses could harm our production output and adversely affect our manufacturing throughput and yield, which could also have a material adverse effect on our business, financial condition or results of operations.

We obtain several raw materials, equipment, parts and supplies from sole suppliers. Likewise, we obtain all of our requirements for granular polysilicon from our facility in Pasadena, Texas. This dependence could have a material adverse effect on our business, financial condition or results of operations. In the case of granular polysilicon, although we believe that we could substitute chunk polysilicon for granular polysilicon, we cannot predict whether this substitution would be successful or how long the related customer qualification process would take. In addition, with any material, unplanned change to increased use of chunk polysilicon as a substitute for granular polysilicon, our manufacturing process would be interrupted and our manufacturing throughput and yields would be adversely affected. A failure to obtain a new qualification or a decrease in our manufacturing throughput or yields could have a material adverse effect on our business, financial condition or results of operations.

From time to time we have experienced limited supplies of certain raw materials, equipment, parts and supplies. We may experience shortages of our key raw materials, equipment, parts and supplies in the future. A prolonged inability to manufacture

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or obtain raw materials, equipment, parts or supplies, or increases in prices resulting from shortages of these critical materials could have a material adverse effect on our business, financial condition or results of operations.

In addition, we often contract with subcontractors that convert our polysilicon into solar wafers which we, in turn, sell to our customers or provide for our own solar energy system projects. If module pricing increases and/or when capacity tightens, as it has in the past, we are forced to accept higher prices and less advantageous payment terms than we would accept in a more normalized supply-demand environment. These factors, which are often outside our control, could also have a material adverse effect on our business, financial condition or results of operations.

We are currently dependent on a limited number of third-party suppliers for certain components for our solar energy systems. We also rely on third-party subcontractors to construct and install our solar energy systems, which could result in sales and installation delays, cancellations, liquidated damages and loss of market share for our SunEdison business.

We rely on a limited number of third-party suppliers for certain components for our solar power systems, such as inverters. If we fail to develop or maintain our relationships with these suppliers or if one of these suppliers goes out of business, we may be unable to install our solar power systems on time, or only at a higher cost or after a long delay, which could prevent us from delivering our solar power systems to our customers within required timeframes. Additionally if one of these suppliers goes out of business, the warranty and other services offered by such supplier may be reduced or eliminated, and we may be required to provide such warranty and services, which could increase our costs. To the extent the processes that our suppliers use to manufacture components are proprietary, we may be unable to obtain comparable components from alternative suppliers. The failure of a supplier to supply components in a timely manner, or at all, or to supply components that meet our quality, quantity and cost requirements, could impair our ability to install solar power systems or may increase our costs.

We utilize and rely on third party subcontractors to construct and install our solar energy systems throughout the world. If our subcontractors do not satisfy their obligations or do not perform work that meets our quality standards or if there is a shortage of third-party subcontractors or labor strikes that interfere with our subcontractors’ ability to complete their work on time and/or on budget, we could experience significant delays in our construction operations, which could have a material adverse effect on our reputation and/or our ability to grow our SunEdison project development business.

Compliance with recently adopted rules of the SEC relating to "conflict minerals" may require us and our suppliers to incur substantial expense and may result in disclosure by us that certain minerals used in products we manufacture or contract to manufacture are not "DRC conflict free."

Section 1502 of the Dodd-Frank Act required the SEC to promulgate rules requiring disclosure by a public company of any "conflict minerals" (tin, tungsten, tantalum and gold) necessary to the functionality or production of a product manufactured or contracted to be manufactured by the public company. The SEC adopted final rules in 2012 which essentially took effect at the end of January 2013. Because MEMC manufactures or contracts to manufacture products which may contain tin, tungsten, tantalum or gold, MEMC will be required under these rules to determine whether those minerals are necessary to the functionality or production of MEMC's products and, if so, conduct a country of origin inquiry with respect to all such minerals. If any such minerals may have originated in the Democratic Republic of the Congo (DRC) or any of its adjoining countries (collectively referred to as "covered countries"), then MEMC and our suppliers must conduct diligence on the source and chain of custody of its conflict minerals to determine if they did originate in one of the covered countries and, if so, whether they financed or benefited armed groups in the covered countries. Disclosures relating to the products which may contain conflict minerals, the country of origin of those minerals and whether they are “DRC conflict free” must be provided in a Form SD (and accompanying conflict minerals report if one is required to disclose the diligence undertaken by MEMC in sourcing the minerals and its conclusions relating to such diligence). If MEMC is required to submit a conflict minerals report, that report must be audited by an independent auditor pursuant to existing government auditing standards, unless (for the first two years) MEMC is unable to determine whether the minerals are "DRC conflict free". As is evident, compliance with this new disclosure rule may be very time consuming for management and MEMC's supply chain personnel (as well as time consuming for our suppliers) and could involve the expenditure of significant amounts of money by us and them. Disclosures by MEMC mandated by the new rules which are perceived by the market to be “negative” may cause customers to refuse to purchase MEMC's products. We are unable to assess the cost of compliance with this rule, and there can be no assurance that such cost will not have an adverse effect on our business, financial condition or results of operations.

Risks Related to Our Operations

We may fail to realize the benefits of our announced closings and restructurings.

In connection with the 2011 Global Plan, we reduced our total workforce by approximately 20%, shuttered the company's Merano, Italy polysilicon facility, reduced production capacity at the company's Portland, Oregon crystal facility and slowed the

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ramp of the Kuching, Malaysia facility. We also previously committed to similar cost reduction actions in June 2011 and significant workforce reductions and facility realignment in 2009. We may be unable to achieve the total annualized cost savings and productivity improvements we currently anticipate from these activities. The timing of facility closings and related cost savings may be delayed due to the demand requirements and customer commitments in the semiconductor and solar industries. Failure to achieve expected savings, or delays in realizing the cost savings, could have a material adverse effect on our financial results. See Note 3 to Notes to Consolidated Financial Statements.

Our relocation of certain U.S. manufacturing operations to our Ipoh, Malaysia facility and expansion and construction of other manufacturing capacity presents business risks which could materially adversely affect our results of operations.

We have invested significantly in expanding our polysilicon production capacity and our 300 millimeter production capacity; ramping our own solar wafer (156 millimeter) manufacturing facility in Kuching, Malaysia; forming our joint venture with Samsung Fine Chemicals to produce high purity polysilicon; and relocating certain Semiconductor Materials manufacturing capacity to Ipoh, Malaysia. Expansion of 300 millimeter and 156 millimeter wafer manufacturing production capacity, ramping of our Ipoh, Malaysia semiconductor manufacturing facility, starting our own solar wafering facility and startup of our joint venture with Samsung Fine Chemicals are all subject to risks such as availability of capital equipment; delays in construction or installation and related technical difficulties in ramping such new capacity to significant production levels; availability of additional precursor raw materials; timing of production ramp; and qualification of new facilities for new and existing customers. The expansion of our 156 millimeter solar wafer manufacturing in Kuching, Malaysia is also subject to additional risks, including refining and adapting our manufacturing technologies to customer requirements, and establishing and maintaining sufficient internal research and development, marketing, sales, production and customer service infrastructure to support this effort.

In order to succeed in these expansions and relocations, we will need to devote the investment of management time and related resources to successfully execute these expansions and relocations. This could disrupt our existing business, affect our operating results and distract our management team. There can be no assurance that we will be able to successfully reach our production, timing and cost goals for our expansions and relocations as customer specifications and demand evolve. Use of capital and management resources that otherwise would have been made available to expand other parts of our business could have material adverse consequences on our results of operations if we fail to manage these expansions and relocations successfully.

If we do not continue to reduce our manufacturing costs and operating expenses, we may not be able to compete effectively in the semiconductor and solar wafer industries.

The success of our Semiconductor Materials and Solar Energy businesses depends, in part, on our continuous reduction of manufacturing costs and leveraging of operating expenses. If we are not able to reduce our manufacturing costs and leverage our operating expenses sufficiently to offset future price erosion, our operating results will be adversely affected. We cannot assure you that we will be able to continue to reduce our manufacturing costs and leverage our operating expenses. Moreover, any future reduction of headcount or closure of one or more of our manufacturing facilities may adversely affect our operational capabilities and our ability to manufacture wafers in required volumes to meet customer demand and may result in other production disruptions, or could require us to take an excess capacity or impairment charges, which could have an adverse effect on our operating results. In our Solar Energy business, cost reductions on balance-of-system costs are also critical to our success in the downstream solar market.

Recent unfair trade complaints filed by the U.S. against imports of solar cells from China, as well as recent unfair trade complaints filed by China against exports of solar-grade polysilicon from the U.S. and South Korea into China, could have significant negative effects on our business, financial condition or results of operations.

In October 2011, a coalition of several U.S. solar companies filed complaints with the U.S. Department of Commerce ("DOC") and International Trade Commission ("ITC") charging that Chinese solar cell manufacturers have engaged in, and benefited from, various unfair trade practices. In June 2012, the DOC imposed duties on the wholesale price of all modules using solar cells manufactured in China.  A similar trade case has also recently been filed by a coalition of several European solar companies in Europe.

In addition, in July 2012, the China Ministry of Commerce ("MOFCOM") announced that it would investigate unfair trade practices related to solar-grade polysilicon imported into China from the U.S. and South Korea. MEMC is one of the named companies in the MOFCOM petition.

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These cases could have a significant impact on both the U.S. solar industry generally and our business specifically, which in the past has relied, and is likely to rely in the future, on modules imported from China for a substantial part of our SunEdison installations.  To the extent that MEMC or SunEdison is or is determined to be the "importer of record" for any solar cells that are imported into the United States or Europe involving Chinese solar cells, the additional cost incurred by the companies directly in the form of import duties could be substantial.  Even if MEMC or SunEdison is not the importer of record, the import duties incurred by our suppliers could significantly increase the cost of modules that we purchase.  Similarly, an unfavorable outcome of the MOFCOM investigation could negatively impact the market prices of solar-grade polysilicon and could restrict our access to the Chinese solar market. The existence and outcome of any of these cases, or if similar cases or retaliatory trade sanctions occur in other countries, could increase the cost of solar components and slow the use of renewable energy throughout the world.  The outcome of this case could also negatively impact specific transactions and negotiations between MEMC and current and future Chinese partners, suppliers and customers.

There are inherent uncertainties in these cases.  An unfavorable outcome could have a material adverse impact on our business, financial position or results of operations, or limit our ability to engage in certain of our business activities to the extent that we are currently intending to engage in such activities. Regardless of the outcome, we could suffer from disruptions to our normal business operations, and these issues could require significant attention from our management.

Our expansion into emerging markets may expose us to legal, political, operational and other risks that could negatively affect our operations and profitability. 

We continue to explore expansion of our international operations in certain markets where we currently operate and in selected new markets.  Emerging market operations can present many risks including the actions and decisions of foreign authorities and regulators, the imposition of limits on foreign ownership of local companies, changes in laws (including tax laws and regulations), their application or interpretation, civil disturbances and political instability, difficulties in protecting intellectual property, changes in applicable currency, restrictions that prevent us from transferring funds from these operations out of the countries in which they operate or converting local currencies we hold into U.S. dollars or other currencies, as well as other adverse actions by foreign governmental authorities and regulators, such as the retroactive application of new requirements on our current and prior activities or operations. Additionally, evaluating or entering into an emerging market may require considerable management time, as well as start-up expenses for market development before any significant revenues and earnings are generated. Operations in new foreign markets may achieve low margins or may be unprofitable, and expansion in existing markets may be affected by local political, economic and market conditions. As we continue to operate our business globally, our success will depend, in part, on our ability to anticipate and effectively manage these and other related risks. The impact of any one or more of these or other factors could adversely affect our business, financial condition or operating results.

If we fail to adequately manage our planned growth in our downstream Solar Energy business, our overall business, financial condition and results of operations could be materially adversely affected.

We expect the amount of our SunEdison megawatts installed to grow significantly over the next year. We expect that this growth will place significant stress on our operations, management, employee base and ability to meet capital requirements sufficient to support this growth over the next 12 months. Any failure to address the needs of our growing business successfully could have a negative impact on our chance of success.

Large scale solar projects in our Solar Energy segment involve concentrated project development risks that may cause significant changes in our financial results.

SunEdison has been developing large solar projects involving significantly greater megawatt production than previous projects. These larger projects may create new operating and financial risks, as well as concentrate project development risks otherwise described in these risk factors. The effect of recognizing U.S. GAAP revenue on the sale of a larger project, including through percentage of completion accounting for certain projects, or the failure to recognize U.S. GAAP revenue as anticipated in a given reporting period because a project is not yet completed or sold under applicable accounting rules by period end, may materially impact our quarterly or annual financial results. These projects may give rise to significant capital commitments which could materially affect cash flow. In addition, if approval by relevant state public utility commissions is delayed or denied or if construction, module delivery, financing, warranty or operational issues arise on a larger project, such issues could have a material impact on our financial results. Finally, SunEdison has built only a few such large scale projects in the past few years, and the management of a greater number of simultaneous projects represents a new test of SunEdison's internal processes, external construction management, capital commitment process, project finance infrastructure and financing ability. The inability to successfully manage these large scale projects could materially adversely affect our results of operations.

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We may incur unexpected warranty and performance guarantee claims that could materially and adversely affect our financial condition and results of operations.

In connection with our products and our services, we may provide various product and system warranties and/or performance guarantees.  For solar energy systems developed, built and sold by SunEdison, we typically provide limited engineering, procurement and construction (EPC) performance guarantees and other warranties against defects in workmanship, engineering design, and installation services under normal use and service conditions for a period of one to two years, or more in certain circumstances, following the substantial completion of a solar energy system.  While we generally are able to pass through manufacturer warranties we receive from our suppliers to our customers, in some circumstances, our warranty period may exceed the manufacturer's warranty period or the manufacturer warranties may not otherwise fully compensate for losses associated with customer claims pursuant to the warranty or performance guarantee we provided. For example, most manufacturer warranties exclude many losses that may result from a system component's failure or defect, such as the cost of de-installation, re-installation, shipping, lost electricity, lost renewable energy credits or other solar incentives, personal injury, property damage, and other losses. In addition, in the event we seek recourse through manufacturer warranties, we will also be dependent on the creditworthiness and continued existence of these suppliers.  As a result, warranty or other performance guarantee claims against us could cause us to incur substantial expense to repair or replace defective products in our solar energy systems. Significant repair and replacement costs could materially and negatively impact our financial condition and results of operations, as well as take up a lot of employee time remedying such issues.  In addition, quality issues can have various other ramifications, including delays in the recognition of revenue, loss of revenue, loss of future sales opportunities, increased costs associated with repairing or replacing products, and a negative impact on our reputation, all of which could also adversely affect our business and operating results.

The loss of one or more of our customers, or failure of any of those customers to meet their obligations under agreements with us could materially adversely affect our results of operations.

Although no single customer accounted for 10% or more of our consolidated net sales in 2011 or 2012, two customers in our Solar Energy business accounted for 12% and 13% of our consolidated net sales in 2010. Our operating results could materially suffer if we experience a significant reduction in, or loss of, purchases by our top customers.

From time to time, one or more customers with which we have a long-term supply agreement may cease placing orders with us in order to attempt to renegotiate price or other terms under the agreement.  Although the long-term supply agreements with these customers are take-or-pay contracts, we cannot assure you that these customers will fulfill their purchase obligations under the agreements, and in fact, we have greatly reduced, or stopped, shipping products under these agreements. Accordingly, we may need to further amend these long-term agreements with our customers in order to reduce prices, make changes to other provisions of the agreements or terminate the agreements altogether, any of which could negatively impact our financial condition or results of operation.

Additionally, we may be required to stop shipping to customers who fail to meet their obligations under long-term supply agreements. The cessation of shipments to these customers could lead to excess or idle production capacity and excess inventory which, if we were unable to sell the products elsewhere or on similar terms, could adversely affect our results of operations.

We face competition in the industries in which we operate, which could force us to reduce our prices to retain market share or face losing market share and revenues.

We face competition in the semiconductor wafer industry from established manufacturers throughout the world, including Shin-Etsu Handotai, SUMCO, Siltronic and LG Siltron. We also face competition in the solar energy services provider market from SunPower Corporation, First Solar, Inc., Enerparc, Sharp Corporation (Recurrent Energy), Phoenix Solar, BELECTRIC, JUWI Solar Gmbh and Solar City. Some of our competitors have substantial financial, technical, engineering and manufacturing resources to develop products that currently, and may, in the future, compete favorably against our products, and some of our competitors in the solar industry may have substantial government-backed financial resources. We expect that our competitors will continue to improve the design and performance of their products and to introduce new products with competitive price and performance characteristics, and our failure to compete effectively could have a material adverse effect on our business, financial condition or results of operations. We may need to reduce our prices to respond to aggressive pricing by our competitors to retain or gain market share, which could have a material adverse effect on our business, financial condition or results of operations.

Because we cannot easily transfer production of specific products from one of our manufacturing facilities to another, manufacturing delays or lack of capacity or output at a single facility could result in a loss of product volume in our Semiconductor Materials and Solar Energy businesses.

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It typically takes three to nine months for our customers to qualify a manufacturing facility to produce a specific product, but it can take longer depending upon a customer’s requirements and market conditions. Interruption of operations or lack of available additional capacity at any of our primary wafer manufacturing facilities could result in delays or cancellations of shipments of wafers and a loss of product volume. Likewise, interruption of operations at our polysilicon manufacturing facility in Pasadena, Texas could adversely affect our semiconductor wafer manufacturing throughput and yields and could result in our inability to produce certain qualified wafer products, delays or cancellations of shipments of wafers and a loss of product volume. A number of factors could cause interruptions, including extreme weather conditions, such as hurricanes, which occur in the Pasadena, Texas area, earthquakes, equipment failures, shortages of raw materials or supplies, transportation logistic complications or labor disputes. We have had interruptions of our manufacturing operations for some of these reasons in the past, and could have such interruptions again in the future. Unions represent some of the employees at our wafer facilities in St. Peters, Missouri, Italy and South Korea, and our granular polysilicon facility in Pasadena, Texas. A work shortage or slowdown at any of these facilities could cause interruptions in manufacturing. We cannot be certain that alternate qualified capacity would be available on a timely basis or at all.

Our business may be harmed if we fail to properly protect our intellectual property.

We believe that the success of our business depends in part on our proprietary technology, information, processes and know how. We try to protect our intellectual property rights based on trade secrets and patents as part of our ongoing research, development and manufacturing activities. We cannot be certain, however, that we have adequately protected or will be able to adequately protect our technology, that our competitors will not be able to utilize our existing technology or develop similar technology independently, that the claims allowed with respect to any patents held by us will be broad enough to protect our technology or that foreign intellectual property laws will adequately protect our intellectual property rights. Moreover, we cannot be certain that our patents provide us with a competitive advantage.

Any litigation in the future to enforce patents issued to us, to protect trade secrets or know how possessed by us or to defend us or to indemnify others against claimed infringement of the rights of others could have a material adverse effect on our business, financial condition and results of operations. From time to time, we receive notices from other companies that allege we may be infringing certain of their patents or other rights. If we are unable to resolve these matters satisfactorily, or to obtain licenses on acceptable terms, we may face litigation, which could have a material adverse effect on us. We are presently involved in a few cases involving allegations of patent infringement by us or by others. Regardless of the validity or successful outcome of any such intellectual property claims, we may need to expend significant time and expense to protect our intellectual property rights or to defend against claims of infringement by third parties, which could have a material adverse effect on us. If we lose any such litigation where we are alleged to infringe the rights of others, we may be required to pay substantial damages, seek licenses from others, or change, or stop manufacturing or selling, some of our products. Any of these outcomes could have a material adverse effect on our business, financial condition or results of operations.

From time to time, we may become involved in costly and time-consuming litigation and other regulatory proceedings, which require significant attention from our management.

In addition to litigation related to our intellectual property rights, we are named a defendant from time to time in other lawsuits and regulatory actions relating to our business, some of which may claim significant damages. Due to the inherent uncertainties of litigation and regulatory proceedings, we cannot accurately predict the ultimate outcome of any such proceedings. An unfavorable outcome could have a material adverse impact on our business and financial position, results of operations or cash flows or limit our ability to engage in certain of our business activities. In addition, regardless of the outcome of any litigation or regulatory proceedings, such proceedings are often expensive, lengthy, disruptive to normal business operations and require significant attention from our management. We are currently, and may be subject in the future, to claims, lawsuits or arbitration proceedings related to matters in tort or under contracts, employment matters, securities class action lawsuits, tax authority examinations or other lawsuits, regulatory actions or government inquiries and investigations.

Our inability to respond to rapid market changes in the solar energy industry, including identification of new technologies and their inclusion in the services that we offer, will adversely affect our business, financial condition or results of operations.

The solar energy industry is characterized by rapid increases in the diversity and complexity of technologies, products and services. In particular, the ongoing evolution of technological standards requires products with lower costs and improved features, such as more efficiency and higher electricity output. If we fail to identify or obtain access to advances in technologies, we may become less competitive, and our business, financial condition or results of operations may be materially adversely affected. In addition, we generally enter into long-term supply contracts and may hold a substantial inventory of solar modules and other related equipment that we utilize to provide our solar energy services. Rapid technological changes could result in

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components that we are contractually committed to purchase or our inventory becoming partially or entirely obsolete or not cost-effective, which could have a material adverse effect on our business, financial condition or results of operations.

A significant deterioration in the financial performance of the U.S. retail industry could materially adversely affect our Solar Energy business, financial condition and results of operations.

The financial performance of our SunEdison business in the United States depends in part upon the continued viability and financial stability of its retail customers. If the retail industry is materially and adversely affected by an economic downturn, increase in inflation or other factors, one or more of our largest customers could encounter financial difficulty, and possibly, bankruptcy. If one or more of our largest customers were to encounter financial difficulty or declare bankruptcy, they may reduce their power purchase agreement payments to us or stop them altogether. Any interruption or termination in payments by our customers would result in less cash being paid to the special purpose legal entities we establish to finance our projects, which could adversely affect the entities’ ability to make lease payments to the financing parties which are the legal owners of many of our solar energy systems or to pay our lenders in the case of the solar energy systems that we own. In such a case, the amount of distributable cash held by the entities would decrease, adversely affecting the cash flows we receive from such entities. In addition, our ability to finance additional new projects with power purchase agreements from such customers would be adversely affected, undermining our ability to grow our business. Any reduction or termination of payments by one or more of our principal customers would have a material adverse effect on our business, financial condition and results of operations.

We are subject to numerous environmental laws and regulations, which could require us to incur environmental liabilities, increase our manufacturing and related compliance costs or otherwise adversely affect our business.

We are subject to a variety of foreign, federal, state and local laws and regulations governing the protection of the environment. These environmental laws and regulations include those relating to the use, storage, handling, discharge, emission, disposal and reporting of toxic, volatile or otherwise hazardous materials used in our manufacturing processes. These materials may have been or could be released into the environment at properties currently or previously owned or operated by us, at other locations during the transport of the materials or at properties to which we send substances for treatment or disposal. If we were to violate or become liable under environmental laws and regulations or become non-compliant with permits required at some of our facilities, we could be held financially responsible and incur substantial costs, including cleanup costs, fines and civil or criminal sanctions, third-party property damage or personal injury claims. Groundwater and/or soil contamination has been detected at four of our facilities. We believe we are taking all necessary remedial steps at these facilities. In addition, if we should decide to close a facility in the future, we could be subject to additional costs related to cleanup and/or remediation of the facility in connection with closing the facility. We do not expect these known conditions to have a material impact on our business. Environmental issues relating to presently known or unknown matters, however, could require additional investigation, assessment or expenditures. In addition, new laws and regulations or stricter enforcement of existing laws and regulations could give rise to additional compliance costs and liabilities.

Although we are not currently regulated as a utility under U.S. federal or state law or the laws and regulations of our foreign markets, we could become regulated as a utility company in the future.

As the owner of solar energy facilities in the United States, each of which has been certified as either a "qualifying small power production facility" or an "exempt wholesale generator", we currently are exempt from most federal and state standards, restrictions and regulatory requirements applicable to U.S. utility companies. As SunEdison's utility-scale business grows, certain facilities may no longer be eligible for exemption from the rate-making provisions of the Federal Power Act, which would require compliance with public utility regulations. Similarly, although we are not currently subject to regulation as an electric utility in the foreign markets in which we provide our solar energy services, our business strategy includes the development of larger solar energy systems in the future which could change our regulatory position. Any local, state, federal or international regulations could place significant restrictions on our ability to operate our business and execute our business plan by prohibiting or otherwise restricting the sale of electricity by us. If we were deemed to be subject to the same state, federal or foreign regulatory authorities as utility companies, such as FERC in the United States, or if new regulatory bodies were established to oversee the solar energy industry in the United States or in our foreign markets, our operating costs could materially increase, adversely affecting our results of operations.

Our brand and reputation are key assets of our business, and if our brand or reputation is damaged, our business and results of operations could be materially adversely affected.

We depend significantly on our reputation for high quality semiconductor materials, solar wafers, solar energy systems and the brand names "MEMC" and "SunEdison" to retain our current customers and attract new customers and joint venture partners in order to grow our business. If we fail to deliver our products or solar energy systems within the planned timelines, our products and services do not perform as anticipated or if we materially damage any of our clients' properties, or cancel

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projects, our brand name and reputation could be significantly impaired, which could materially adversely affect our business and results of operations.

Future acquisitions may present other integration challenges.

If we find other appropriate opportunities in the future, we may acquire businesses, products or technologies that we believe are strategic. If we acquire a business, product or technology, the process of integration may produce unforeseen operating difficulties and expenditures, fail to result in expected synergies or other benefits and absorb significant attention of our management that would otherwise be available for the ongoing development of our business.

Risks Related to Our Indebtedness

If we fail to comply with covenants under our credit facilities, the lenders could cause outstanding amounts to become immediately due and payable, and we might not have sufficient funds and assets to pay such loans.

We are party to a $400 million revolving credit facility with Bank of America, N.A. and other lenders named therein. In addition, we closed on a $200 million second lien term loan during the third quarter of 2012. We also are a party to a $150 million non-recourse construction financing credit facility with Deutsche Bank which provides specific funding for our solar energy projects. We may enter into additional facilities in the future to support our growth plan. These facilities contain certain restrictive covenants and conditions, including a no material adverse change drawing condition, and we expect future facilities will have similar restrictive covenants, including cross-default provisions affecting other instruments of indebtedness. A violation of any of these covenants, which in our industries could occur in a sudden or sustained downturn, would be deemed an event of default under the facilities. In such event, upon election of the lenders, the loan commitments under the credit facilities would terminate and the loans and accrued interest then outstanding would be due and payable immediately. We may not have sufficient funds and assets to cover any such required payments and may not be able to obtain replacement financing on a timely basis or at all. These events could have a material adverse effect on our business depending on our outstanding balances at that time. We have also had to negotiate changes to our covenants in the past and may need to do so again in the future with no assurances that we will be able to do so. As of December 31, 2012, we had no outstanding borrowings under our $400 million revolving credit facility, although we had approximately $122 million of outstanding third party letters of credit backed by this facility at such date. As of December 31, 2012, we had $7.4 million outstanding under the Deutsche Bank credit facility.

Our long-term indebtedness could adversely affect our operations and financial condition.

As of December 31, 2012, we had approximately $1,563 million of non-recourse long-term debt related to our SunEdison solar energy systems. On March 10, 2011, we issued $550 million of 7.75% Senior Notes due 2019 (the "2019 Notes"). In addition, in March 2011, we amended and restated our revolving credit agreement to allow us to borrow up to $400 million in senior secured indebtedness, and as described above, we closed on a $200 million second lien term loan in September 2012. As of December 31, 2012, we had no outstanding borrowings under our revolving credit facility, although we had $122 million of outstanding third-party letters of credit backed by this facility at such date. Our indebtedness could have important consequences, including but not limited to:

•limiting our ability to invest operating cash flow in our operations due to debt service requirements;

• limiting our ability to obtain additional debt or equity financing for working capital expenditures, product development or other general corporate purposes;

•limiting our operational flexibility due to the covenants contained in our debt agreements;

•limiting our ability to make required investments in our joint ventures;

•requiring us to dispose of significant assets in order to satisfy our debt service obligations;

• limiting our flexibility in planning for, or reacting to, changes in our business or industry, thereby limiting our ability to compete with companies that are not as highly leveraged; and

•increasing our vulnerability to economic downturns and changing market conditions.

Our ability to meet our expenses and debt service obligations will depend on the factors described above, as well as our future performance, which will be affected by financial, business, economic and other factors, including potential changes in consumer preferences, the success of product and marketing innovation and pressure from competitors. If we do not generate enough cash to pay our debt service obligations, we may be required to refinance all or part of our existing debt, sell our assets, borrow more money or raise equity. We cannot assure you that we will be able to, at any given time, refinance our debt, sell our assets, borrow more money or raise equity on acceptable terms or at all.

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We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control. We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to fund our day-to-day operations or to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to sell assets or operations, seek additional capital or restructure or refinance our indebtedness. We may not be able to effect any such alternative measures, if necessary, on commercially reasonable terms or at all and, even if successful, such alternative actions may not allow us to meet our scheduled debt service obligations. Our amended corporate credit facility, second lien term loan and the indenture to the 2019 Notes restrict our ability to dispose of assets and use the proceeds from any such dispositions and may also restrict our ability to raise debt or equity capital to be used to repay other indebtedness when it becomes due. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet any debt service obligations then due.

Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, would materially and adversely affect our financial position and results of operations and our ability to satisfy our debt obligations. If we cannot make scheduled payments on our debt, we will be in default and, as a result, holders of 2019 Notes could declare all outstanding principal and interest to be due and payable, the lenders under our amended corporate credit facility could terminate their commitments to loan money, or foreclose against the assets securing such borrowings, and we could be forced into bankruptcy or liquidation, in each case, which could have a material adverse effect on our business, financial condition and results of operations.

Restrictive covenants in the indenture and our credit agreement may limit our current and future operations, particularly our ability to respond to changes in our business or to pursue our business strategies.

The terms of certain of our indebtedness, including our corporate credit facility, second lien term loan and the indenture relating to the 2019 Notes, contain a number of restrictive covenants that impose significant operating and financial restrictions, including restrictions on our ability to take actions that we believe may be in our interest. In addition, the indenture related to the 2019 Notes, our corporate credit facility and the second lien term loan limit our ability to, among other things:

•incur additional indebtedness and guarantee indebtedness;

• pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments;

•enter into certain agreements that restrict distributions from restricted subsidiaries;

•sell or otherwise dispose of assets, including capital stock of restricted subsidiaries;

•enter into transactions with affiliates;

•create or incur liens;

•merge, consolidate or sell substantially all of our assets;

•make investments; and

•make certain payments on indebtedness.

A breach of the covenants or restrictions under the indenture, our amended and restated corporate credit facility or our second lien term loan could result in a default under the applicable indebtedness. Such default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross acceleration or cross-default provision applies. In the event our lenders and noteholders accelerate the repayment of our borrowings, we cannot assure you that we and our subsidiaries would have sufficient assets to repay such indebtedness.

The restrictions contained in the indenture governing the 2019 Notes and the agreements governing our other indebtedness could adversely affect our ability to:

•finance our operations;

•make needed capital expenditures;

•make strategic acquisitions or investments or enter into alliances;

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•withstand a future downturn in our business or the economy in general;

•engage in business activities, including future opportunities, that may be in our interest; and

•plan for or react to market conditions or otherwise execute our business strategies.

Our financial results, our substantial indebtedness and our credit ratings could adversely affect the availability and terms of our financing.

We and our subsidiaries may incur substantially more debt, including secured debt, in the future.

We and our subsidiaries may incur significant additional debt, including secured debt, in the future. Although the indenture governing the 2019 Notes and our credit agreements contain restrictions on the incurrence of additional debt, these restrictions are subject to a number of important exceptions, and debt incurred in compliance with these restrictions could be substantial. The additional debt that we and our subsidiaries may obtain in the future could intensify the risk that we may not be able to fulfill our obligations under the 2019 Notes or other financing arrangements.

A downgrade in our credit rating could negatively affect our ability to access credit on reasonable terms and may materially adversely impact our business and results of operations.

Periodically, third party rating agencies evaluate us and rate our financial strength based on criteria established by the rating agencies, and as a result of such evaluations, may downgrade our ratings if we do not continue to meet the criteria of the ratings previously assigned to us.  In late February 2012, Moody's downgraded MEMC's corporate family credit rating and our 2019 Notes rating, and in the second quarter of 2012, S&P downgraded our corporate family rating, and Moody's again downgraded our corporate family rating and the 2019 Notes. These downgrades or potential future downgrades to our credit rating has limited and may limit in the future or restrict our ability to borrow under certain current credit facilities or to secure new or additional credit facilities, and may increase the costs of borrowing, increase letter of credit requirements for our solar energy projects and subject us to more onerous debt covenants, all of which could have a material adverse effect on our financial condition and results of operations.

Capital and Financial Market Risks

We need to obtain additional project financing to implement our current business plan. The failure to obtain such financing may restrict our ability to grow.

Our current capital and revolving credit facilities are not sufficient to enable us to execute our current business plans, and we will be required to obtain additional project financing for our planned solar energy projects. We may not have funds sufficient for additional investments in our business that we might want to undertake. We will require additional capital in the near term, and we continue to look for opportunities to optimize our capital structure. We plan to pursue sources of such capital through various financing transactions and arrangements, including debt financing, equity financing, joint venturing of projects or other means. We may not be successful in locating suitable financing transactions in the time period required or at all, or on terms we find attractive, and we may not obtain the capital we require by other means. If we do succeed in raising additional capital, the capital received may not be sufficient to fund our operations going forward without obtaining further additional financing. In addition, debt and possible mezzanine financing may involve a pledge of assets and may be senior to equity holders.

Our ability to obtain needed financing may be impaired by conditions in the capital markets (both generally and in our industries in particular). Some of the contractual arrangements governing our operations may require us to maintain minimum capital, and we may lose our contract rights if we do not have the required minimum capital. If the amount of capital we are able to raise from financing activities is insufficient, we may be required to curtail our business plans. However, in the event we are unable to find additional financing opportunities, we believe we will be able to adjust our operating plans to execute our business plans for at least the next twelve months.

Because we manufacture and sell a substantial portion of our products outside of the United States, we are subject to the risks of doing business internationally, including periodic foreign economic downturns and political instability, which may adversely affect our sales and cost of doing business in those regions of the world.

Economic downturns have affected our operating results in the past and could affect our operating results in the future. Additionally, other factors may have a material adverse effect on our business, financial condition or results of operations in the future, including:

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• the imposition of governmental controls or changes in government regulations, including tax regulations;

• export license requirements;

• restrictions on the export of technology;

• expropriation;

• compliance with U.S. and international laws involving international operations, including the Foreign Corrupt Practices Act and export control laws;

• difficulties in enforcing our intellectual property;

• difficulties in achieving headcount reductions;

• restrictions on transfers of funds and assets between jurisdictions;

• geo-political instability; and

• trade restrictions and changes in tariffs.

We cannot predict whether these economic risks inherent in doing business in foreign countries will have a material adverse effect on our business, financial condition and results of operations in the future.

We currently operate under tax holidays and/or favorable tax incentives and rates in certain foreign jurisdictions. Such tax holidays and incentives often require us to meet certain minimum employment and investment criteria or thresholds in these jurisdictions. We cannot assure you that we will be able to continue to meet these criteria or thresholds or realize any net tax benefits from these tax holidays or incentives. If any of our tax holidays or incentives are terminated, our results of operations could be materially adversely effected.

We are subject to periodic fluctuations in foreign currency exchange rates which could cause operating results and reported financial results to vary significantly from period to period.

Sales outside of the United States, approximately 71% of all our sales in 2012, expose us to currency exchange rate fluctuations. Our risk exposure from these sales is primarily related to the Euro, Canadian Dollar, Japanese Yen, Indian Rupee and Korean Won. Because the majority of our sales are denominated in the U.S. Dollar, if one or more competitors sells to our customers in a different currency than the U.S. Dollar, we are subject to the risk that the competitors' products will be relatively less expensive than our products due to exchange rate effects. For 2012, approximately 64% of our sales were denominated in U.S. Dollars, compared to approximately 74% in 2011.

In addition, a substantial portion of manufacturing and operating costs at our non-U.S. facilities are incurred in foreign currencies, principally the Euro, Taiwan Dollar, Korean Won, Malaysian Ringgit, Japanese Yen and Singapore Dollar. Unfavorable exchange rate fluctuations in any or all of these currencies may adversely affect the cost of our products and/or related operating expenditures.

We recognized net currency losses totaling approximately $17.8 million in 2012, $4.7 million in 2011, and $0.5 million in 2010. We cannot predict whether the foreign currency exchange risks inherent in doing business in foreign countries will have a material adverse effect on our business, financial condition or results of operations in the future.

Risks Related to an Investment in Our Common Stock

The market price of our common stock has fluctuated significantly, especially in recent years, and may continue to do so in the future.

We are a participant in both the semiconductor industry and the solar industry, two industries that have often experienced extreme price and trading volume fluctuations that often have been unrelated to the operating performance of an individual company. This market volatility may adversely affect the market price of our common stock. The market price of our common stock may be affected by various factors, including:

• quarterly fluctuations in our operating results resulting from factors such as timing of orders from and shipments to major customers, product mix, competitive pricing pressures and sales of solar energy systems;

• our ability to convert our SunEdison pipeline and backlog into completed solar energy systems at historical or anticipated rates;

• market conditions experienced by our customers and in the semiconductor industry and solar industry;

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• announcements of operating results that are not aligned with the expectations of investors;

• general worldwide macroeconomic conditions, including availability of project financing and related interest rates;

• changes in our relationships with our customers;

• seasonality of our SunEdison business;

• announcements of technological innovations, new products or upgrades to existing products by us or our competitors;

• interruption of operations at our manufacturing facilities or the facilities of our suppliers;

• developments in patent or other proprietary rights by us or by our competitors; and

• general stock market trends.

The accounting treatment for many aspects of our SunEdison business is complex and any changes to the accounting interpretations or accounting rules governing our SunEdison business could have a material adverse affect on our U.S. GAAP reported results of operations and financial results.

The accounting treatment for many aspects of our SunEdison business is complex, and our future results could be adversely affected by changes in the accounting treatment applicable to our SunEdison business. In particular, any changes to the accounting rules regarding the following matters may require us to change the manner in which we operate and finance our SunEdison business:

• the classification of our sale-leaseback transactions as operating, capital or real estate financing transactions;

• revenue recognition and related timing;

• intracompany contracts;

• operation and maintenance contracts;

• joint venture accounting, including the consolidation of joint venture entities and the inclusion or exclusion of their assets and liabilities on our balance sheet;

• long-term vendor agreements; and

• foreign holding company tax treatment.

We make estimates and assumptions in connection with the preparation of our consolidated financial statements, and any changes to those estimates and assumptions could have a material adverse effect on our results of operations.

In connection with the preparation of our consolidated financial statements, we use certain estimates and assumptions based on current facts, historical experience and various other factors that may affect reported amounts and disclosures. Our most critical accounting estimates are described in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2012 Annual Report. While we believe that these estimates and assumptions are reasonable under the circumstances, they are subject to significant uncertainties, some of which are beyond our control. Should any of these estimates and assumptions change or prove to have been incorrect, it could have a material adverse effect on our results of operations, which could cause our stock price to decline.

Any future strategic acquisitions we make could have a dilutive effect on our current stockholders' investment, and if the goodwill, indefinite-lived intangible assets and other long-term assets recorded in connection with such acquisitions become impaired, we would be required to record additional impairment charges, which may be significant.

The acquisition of SunEdison in 2009 included the initial issuance of approximately 3.8 million shares of our common stock and then a subsequent issuance of an additional approximately 2.1 million shares to the former equity holders of SunEdison. The acquisition of Solaicx in July 2010 included contingent consideration, a portion of which would be payable with our common stock.We have also completed other acquisitions, such as the acquisition of FRV U.S. in 2011, where we did not use equity securities as part of the acquisition consideration.  Future acquisitions involving issuances of equity securities could have a dilutive effect on our current stockholders' investment. If we make future acquisitions, we may issue shares of stock that dilute other stockholders, expend cash, incur debt, assume contingent liabilities or create additional expenses related to other amortizable intangible assets, any of which might harm our business, financial condition or results of operations.

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In the event of any future acquisitions, we may record a portion of the assets we acquire as goodwill, other indefinite-lived intangible assets and finite-lived intangible assets. We do not amortize goodwill and indefinite-lived intangible assets, but rather review them for impairment on an annual basis or whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The recoverability of these assets is dependent on our ability to generate sufficient future earnings and cash flows. Changes in estimates, circumstances or conditions, resulting from both internal and external factors, could have a significant impact on our fair valuation determination, which could then result in a material impairment charge negatively affecting our results of operations.

We are required to evaluate our internal controls over financial reporting under Section 404 of the Sarbanes-Oxley Act and any adverse results from such evaluation, or the failure to develop internal controls necessary for our newly acquired businesses to achieve compliance with Section 404, could result in a loss of investor confidence in our financial reports and could have an adverse effect on our stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act, we are required to furnish a report by our management assessing the effectiveness of our internal control over financial reporting as of the end of our fiscal year. This assessment must include disclosure of any material weaknesses in our internal control over financial reporting identified by management. The report must also contain a statement that our auditors have issued an attestation report on management’s assessment of our internal controls over financial reporting.

If our management identifies one or more material weaknesses in our internal control over financial reporting, we will be unable to assert our internal control over financial reporting is effective. If we are unable to assert that our internal control over financial reporting is effective presently or in the future (or if our auditors are unable to express an opinion that our internal controls over financial reporting are effective), we could incur additional costs and expenses to resolve these deficiencies and lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on our stock price. As of December 31, 2012, management had determined that our internal control over financial reporting is effective.

Certain provisions of our Restated Certificate of Incorporation and Restated By-Laws could delay or make more difficult a change of control or change in management that would benefit our stockholders.

Certain provisions of our Restated Certificate of Incorporation and Restated By-Laws may delay, defer or make more difficult:

• a merger, tender offer or proxy contest;

• the assumption of control by a holder of a large block of our securities; and

• the replacement or removal of current management by our stockholders.

For example, our Restated Certificate of Incorporation divides the Board of Directors into three classes, with members of each class to be elected for staggered three-year terms. This provision may make it more difficult for stockholders to change the majority of directors and may frustrate accumulations of large blocks of common stock by limiting the voting power of such blocks. This may further discourage a change of control or change in current management. As a result of a stockholder proposal that was approved at our 2012 Annual Meeting of Stockholders, in December 2012 we announced that the Board of Directors voted to include in our proxy statement for our 2013 Annual Meeting of Stockholders an MEMC proposal to eliminate the Company's classified Board structure. If this proposal passes, it would eventually become easier for a potential acquiror to replace our entire Board of Directors in one year.

These provisions may limit participation by our stockholders in any merger or other change of control transaction, whether or not the transaction is favored by current management or would be favorable to our stockholders. These provisions may also make removal of current management by our stockholders more difficult, even if such removal would be beneficial to the stockholders generally.

The issuance of preferred stock could adversely affect holders of common stock.

Our Board of Directors is authorized to issue series of preferred stock without any action on the part of our holders of common stock. Our Board of Directors also has the power, without stockholder approval, to set the terms of any such series of preferred stock that may be issued, including voting rights, dividend rights, preferences over our common stock with respect to dividends or if we liquidate, dissolve or wind up our business and other terms. If we issue preferred stock in the future that has preference over our common stock with respect to the payment of dividends or upon our liquidation, dissolution or winding up, or if we issue preferred stock with voting rights that dilute the voting power of our common stock, the rights of holders of our common stock or the price of our common stock could be adversely affected.

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Cautionary Statement Regarding Forward-Looking Statements

Statements set forth in this Form 10-K or statements incorporated by reference from documents we have filed with the Securities and Exchange Commission may contain forward-looking statements. Forward-looking statements are not based on historical facts but instead reflect our expectations, estimates or projections concerning future results or events, including, without limitation, statements regarding demand and/or pricing of our products or the pricing environment in the future; our expectation that we will generate sufficient taxable income to realize the benefits of our net deferred tax assets; the appropriateness of our tax positions and the timing of our tax audits; the timing of our various manufacturing ramps or the cessation or continuation of production at certain facilities; the anticipated growth of our business in 2013 and beyond; the effects of economic factors on our market capitalization; our expectation that we will have the financial resources and liquidity needed to meet our business requirements throughout 2013; future amendments or termination of our agreements with our long-term solar wafer customers and payments associated with such contracts; our estimates of penalties associated with termination of or purchase shortfalls under certain of our long-term supply contracts with our vendors; the nature and extent of tax rebate programs or feed-in-tariffs in the future; our expectations regarding indemnification payments related to tax credits; the ultimate impact our legal proceedings may have on us; the charges we expect to incur, the timing of completion, the savings we expect to realize, the number of employees who will be affected and our execution of our announced restructurings; our expectations regarding our annual pre-tax operating benefits upon the completion of our restructuring activities; our expectations regarding recognition of annual amortization expenses; our expectations regarding our investments in research and development; our expectations regarding our future cash flow generation; our expectations regarding solar wafer sales to external parties and sales of our solar energy systems; the amount of our contributions to our pension plans in 2013 and our estimates regarding actuarial loss (gain) and future benefits payable under our pension plans; the anticipated effect of certain accounting pronouncements on our results of operations and financial condition; the classification of our solar energy systems as direct sales, sale-leasebacks or held systems and the current and subsequent accounting treatment of such transactions; our expectations regarding the timing and amount of our investments in our joint ventures; the timing of completion of the construction, installation and testing of the equipment and the milestone payments related to the SMP JV; the requirements of and our compliance with the terms governing our indebtedness, including the indenture governing the 2019 Notes and the impact of related cross default provisions; the sources of funding and our ability to access funding for our SunEdison business; our expectation regarding SunEdison's purchase of RECs; our ability to compete effectively in the markets we serve; and our statements regarding our working capital and other capital requirements for the next 12 months.

These statements generally can be identified by the use of forward-looking words or phrases such as "believe," "expect," "anticipate," "may," "could," "intend," "belief," "estimate," "plan," "likely," "will," "should" or other similar words or phrases. These statements are not guarantees of performance and are inherently subject to known and unknown risks, uncertainties and assumptions that are difficult to predict and could cause our actual results, performance or achievements to differ materially from those expressed in or indicated by those statements. We cannot assure you that any of our expectations, estimates or projections will be achieved. The forward-looking statements included in this document are only made as of the date of this document, and we disclaim any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances.

Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. You should not place undue reliance on such statements, which speak only as of the date that they were made. Factors that could cause actual results to differ materially are set forth under this "Item 1A. Risk Factors".

These cautionary statements should be considered in connection with any written or oral forward-looking statements that we may issue in the future. We do not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect later events or circumstances or to reflect the occurrence of unanticipated events.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

Our principal executive offices are located at 501 Pearl Drive (City of O'Fallon), St. Peters, Missouri 63376, and our telephone number at that address is (636) 474-5000. Our principal manufacturing and administrative facilities comprised approximately 4.9 million square feet as of December 31, 2012 and were situated in the following locations:

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Location	Segment(s)	Square Footage
St. Peters, MO, USA	Corporate; Semiconductor Materials; Solar Energy	592,427
Sherman, TX, USA	Semiconductor Materials	693,000
Portland, OR, USA	Solar Energy	135,400
Pasadena, TX, USA	Solar Energy	436,000
Hsinchu, Taiwan	Semiconductor Materials	649,000
Chonan, South Korea	Semiconductor Materials	462,400
Ipoh, Malaysia	Semiconductor Materials	431,300
Utsunomiya, Japan	Semiconductor Materials	306,000
Merano, Italy	Semiconductor Materials; Solar Energy	332,780
Novara, Italy	Semiconductor Materials	330,700
Kuala Lumpur, Malaysia	Semiconductor Materials	55,000
Kuching, Malaysia	Solar Energy	296,900
Beltsville, MD, USA	Solar Energy	16,649
Belmont, CA, USA	Corporate; Solar Energy	117,507
Singapore	Corporate; Solar Energy	37,255

• The Sherman, Texas facility was closed as of December 31, 2011. Management is currently evaluating various options with respect to this facility, including selling it.

• We lease the land on which our Pasadena, Texas facility is located. The term of the Pasadena lease expires in 2030 and is extendable for four additional renewal terms of five years each.

• We lease the land on which our Hsinchu, Taiwan facility is located. This lease expires in 2014 and is extendable for not less than a 20-year renewal period thereafter.

• We lease our facility in Kuala Lumpur, Malaysia. This lease expires in April 2015 and is extendable for one two-year period thereafter.

• We lease our facility in Singapore. This lease expires in July 2014 and is extendable for one three-year period thereafter.

• We also lease the property located in Beltsville, Maryland through our SunEdison business. The lease was renewed for one year and expires in December 2013.

• We also lease our facility in Portland, Oregon. The lease expires in August 2018.

• The square footage with respect to the Merano, Italy facility includes square footage related to our polysilicon operations, which was shuttered as of December 31, 2011, as well as square footage related to the TCS plant we acquired in connection with the contract settlement with Evonik.

• We also lease the property located in Belmont, California through our SunEdison business. The lease expires in April 2018 and is extendable for two five-year periods thereafter.

We believe that our existing facilities and equipment are well maintained, in good operating condition and are adequate to meet our current requirements. The extent of utilization of these facilities varies from plant to plant and from time to time during the year.

Item 3. Legal Proceedings

S.O.I.TEC Silicon on Insulator Technologies S.A. v. MEMC Electronic Materials, Inc.

On May 19, 2008, Soitec and Commissariat A L'Energie Atomique ("CEA") filed a complaint against MEMC in the U.S. District Court for the District of Delaware (Civil Action No. 08-292) alleging infringement, including willful infringement, by MEMC of three U.S. patents related to silicon-on-insulator technology, and requested damages and an injunction. Soitec and CEA filed an amended complaint on July 21, 2009, adding a fourth, related patent to the lawsuit. MEMC filed a counterclaim against Soitec for infringement of one of MEMC's U.S. patents. The Court bifurcated the case into two phases, a first liability phase, which, to the extent liability is found, will be followed by a second damages phase. In a memorandum opinion dated

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October 13, 2010, the Court found that all of MEMC's current products and processes do not infringe any valid claim of the four asserted Soitec patents.

The Court held a jury trial from October 25, 2010 to November 2, 2010. After the Court's October 13, 2010 ruling in favor of MEMC, the only remaining claim that Soitec continued to assert at trial was a single patent claim directed against some mono-implant research and development efforts conducted by MEMC approximately five to seven years ago, none of which have occurred since 2006, and none of which are material or relevant to the current operations at MEMC. MEMC continued to assert at trial its counterclaim for infringement of MEMC's patent. On November 2, 2010, the jury found that certain of Soitec's wafers infringed the patent asserted by MEMC at trial. The jury also found that one of the Soitec patent claims was valid. This single patent claim covers MEMC's mono-implant research and development efforts that ended in 2006. On July 13, 2011, the court denied all post trial motions. Soitec subsequently filed an appeal and MEMC filed a cross-appeal. The appeal is now fully briefed in the U.S. Court of Appeals for the Federal Circuit; however, the appeal has been stayed pending en banc review of a jurisdictional question unrelated to the merits of the appeal.  While it is difficult to predict the duration of the stay, it will likely extend for at least three months and could last much longer.  No further developments will occur with the case during the stay. The damages phase of this trial will occur, if at all, after the appeal. We believe that Soitec and CEA's suit against us has no merit, and we are asserting a vigorous defense against these claims, as well as our infringement counterclaim. Although it is not possible to predict the outcome of such matters, we believe that the ultimate outcome of this proceeding will not have a material adverse effect on our financial position, cash flows or results of operations.

Jerry Jones v. MEMC Electronic Materials, Inc., et al.

On December 26, 2008, a putative class action lawsuit was filed in the U.S. District Court for the Eastern District of Missouri by plaintiff, Jerry Jones, purportedly on behalf of all participants in and beneficiaries of MEMC's 401(k) Savings Plan (the "Plan") between September 4, 2007 and December 26, 2008, inclusive. The complaint asserted claims against MEMC and certain of its directors, employees and/or other unnamed fiduciaries of the Plan. The complaint alleges that the defendants breached certain fiduciary duties owed under the Employee Retirement Income Security Act, generally asserting that the defendants failed to make full disclosure to the Plan's participants of the risks of investing in MEMC's stock and that the company's stock should not have been made available as an investment alternative in the Plan. The complaint also alleges that MEMC failed to disclose certain material facts regarding MEMC's operations and performance, which had the effect of artificially inflating MEMC's stock price.

On June 1, 2009, an amended class action complaint was filed by Mr. Jones and another purported participant of the Plan, Manuel Acosta, which raises substantially the same claims and is based on substantially the same allegations as the original complaint. However, the amended complaint changes the period of time covered by the action, purporting to be brought on behalf of beneficiaries of and/or participants in the Plan from June 13, 2008 through the present, inclusive. The amended complaint seeks unspecified monetary damages, including losses the participants and beneficiaries of the Plan allegedly experienced due to their investment through the Plan in MEMC's stock, equitable relief and an award of attorneys' fees. No class has been certified and discovery has not begun. The company and the named directors and employees filed a motion to dismiss the complaint, which was fully briefed by the parties as of October 9, 2009. The parties each subsequently filed notices of supplemental authority and corresponding responses. On March 17, 2010, the court denied the motion to dismiss. The MEMC defendants filed a motion for reconsideration or, in the alternative, certification for interlocutory appeal, which was fully briefed by the parties as of June 16, 2010. The parties each subsequently filed notices of supplemental authority and corresponding responses. On October 18, 2010, the court granted the MEMC defendants' motion for reconsideration, vacated its order denying the MEMC defendants' motion to dismiss, and stated that it will revisit the issues raised in the motion to dismiss after the parties supplement their arguments relating thereto. Both parties filed briefs supplementing their arguments on November 1, 2010. On June 28, 2011, plaintiff Jerry Jones filed a notice of voluntary withdrawal from the action. On June 29, 2011, the Court entered an order withdrawing Jones as one of the plaintiffs in this action. The parties each have continued to file additional notices of supplemental authority and responses thereto. On September 27, 2012, the MEMC defendants moved for oral argument on their pending motion to dismiss; plaintiff Manuel Acosta joined in the MEMC defendants' motion for oral argument on October 9, 2012.  The Court has not ruled on this motion for oral argument. 

MEMC believes the above class action is without merit, and we will assert a vigorous defense. Due to the inherent uncertainties of litigation, we cannot predict the ultimate outcome or resolution of the foregoing class action proceedings or estimate the amounts of, or potential range of, loss with respect to these proceedings. An unfavorable outcome could have a material adverse impact on our business, results of operations and financial condition. We have indemnification agreements with each of our present and former directors and officers, under which we are generally required to indemnify each such director or officer against expenses, including attorneys' fees, judgments, fines and settlements, arising from actions such as the lawsuits described above (subject to certain exceptions, as described in the indemnification agreements).

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From time to time we may conclude it is in the best interests of our stockholders, employees, vendors and customers to settle one or more litigation matters, and any such settlement could include substantial payments; however, other than as may be noted above, we have not reached this conclusion with respect to any particular matter at this time. There are a variety of factors that influence our decision to settle any particular individual matter, and the amount we may choose to pay or accept as payment to settle such matters, including the strength of our case, developments in the litigation (both expected and unexpected), the behavior of other interested parties, including non-parties to the matter, the demand on management time and the possible distraction of our employees associated with the case and/or the possibility that we may be subject to an injunction or other equitable remedy. It is difficult to predict whether a settlement is possible, the amount of an appropriate settlement or when is the opportune time to settle a matter in light of the numerous factors that go into the settlement decision.

Item 4.     Mine Safety Disclosure

Not applicable.

Executive Officers of the Registrant

The following is information concerning our executive officers as of January 31, 2013.

Name	Age	All Positions and Offices Held
Ahmad R. Chatila	46	President, Chief Executive Officer and Director
Carlos Domenech	44	Executive Vice President; President-Solar Energy
Shaker Sadasivam	53	Executive Vice President-Semiconductors; Senior Vice President, Research and Development
Brian Wuebbels	40	Executive Vice President and Chief Financial Officer
Vijayan S. Chinnasami	47	Senior Vice President, Solar Materials
Matthew E. Herzberg	45	Senior Vice President and Chief Human Resources Officer
Bradley D. Kohn	44	Senior Vice President, General Counsel and Corporate Secretary
Stephen O’Rourke	48	Senior Vice President and Chief Strategy Officer
David A. Ranhoff	57	Senior Vice President, Sales & Marketing

Mr. Chatila has served as President, Chief Executive Officer and as a director since March 2, 2009. Prior to joining MEMC, Mr. Chatila served as Executive Vice President, Memory and Imaging Division of Cypress Semiconductor Corporation from July 2005 to February 2009. From September 2004 to June 2005, Mr. Chatila was the Vice President of Operations of the Cypress Memory and Imaging Division, and before that he served as Managing Director of the low power memory business unit in the Memory and Imaging Division from January 2003 to September 2004. Mr. Chatila initially joined Cypress in 1991 and held a number of management roles in wafer technology development, manufacturing and sales since that time, including the positions described above. From November 1997 to December 1999, Mr. Chatila worked for Taiwan Semiconductor Manufacturing Company (TSMC) as Senior Account Manager, before rejoining Cypress in January 2000.

Mr. Domenech joined MEMC as Executive Vice President and President of SunEdison in connection with the SunEdison acquisition, which was completed in November 2009. Prior to joining SunEdison, Mr. Domenech served as Chief Financial Officer at Universal Pictures’ International Entertainment, where he led its integration with NBC, from 2004 to 2007. Prior to joining Universal, Mr. Domenech spent 14 years with General Electric Company, where he served in a variety of global executive roles, including as Chief Financial Officer of GE Healthcare’s EMEA Service.

Dr. Sadasivam has been our Senior Vice President, Research and Development since July 2002. In October 2009, he was also named our Executive Vice President of Semiconductors. Dr. Sadasivam was President of MEMC Japan Ltd., our Japanese subsidiary, from April 2002 to June 2002. From July 2000 to March 2002, Dr. Sadasivam served as our Director, Worldwide Operations Technology. Dr. Sadasivam was Director, Technology for MEMC Korea Company, our South Korean subsidiary, from July 1999 to June 2000. From September 1997 to June 1999, Dr. Sadasivam held positions in the manufacturing technology group for our St. Peters facility.

Mr. Wuebbels became MEMC’s Executive Vice President and Chief Financial Officer effective May 16, 2012. Previously, Mr. Wuebbels served as MEMC's Vice President and General Manager – Balance of System Products. At MEMC, he has also served as Vice President, Solar Wafer Manufacturing, Vice President of Financial Planning and Analysis, and Vice President Operations Finance. Before joining MEMC in 2007, Mr. Wuebbels was Vice President and CFO of

31

Honeywell's Sensing and Controls Business.  Prior to Honeywell, Mr. Wuebbels spent 10 years at the General Electric Company in various senior finance and operations roles in multiple businesses around the world.

Mr. Chinnasami joined MEMC in August 2010 and became MEMC's Senior Vice President, Solar Materials on May 16, 2012.  Previously, Mr. Chinnasami served as Vice President of MEMC's module business unit.  His current responsibilities include the executive management of the polysilicon, wafer, cell and module businesses.  Prior to joining MEMC, Mr. Chinnasami served as Senior Vice President over the Industrial Business Unit at Johnson Electric Hong Kong from  2008 to 2009.  Prior to Johnson Electric, Mr. Chinnasami spent 11 years at Flextronics, where he served in a variety of roles, including Vice President and General Manager over the Consumer Segment business unit.

Mr. Herzberg joined MEMC as Senior Vice President and Chief Human Resource Officer in March 2011. Prior to joining MEMC, Mr. Herzberg was employed by Express Scripts, Inc. from 2006 to February 2011. Mr. Herzberg most recently served as Vice President of Human Resources and was responsible for all facets of human resources at Express Scripts, Inc. Prior to that role, Mr. Herzberg served as the Vice President, Talent Management & Total Rewards and the Vice President, Organizational and Leadership Development of Express Scripts, Inc.

Mr. Kohn served as Vice President, General Counsel and Corporate Secretary from September 2005 until October 2009 when he was promoted to Senior Vice President. Prior to joining MEMC, from March 2000 until September 2005, Mr. Kohn was with Pillsbury Winthrop Shaw Pittman LLP (formerly Pillsbury Madison & Sutro LLP) in its Palo Alto office, most recently as a partner in the Corporate Securities Group.

Mr. O'Rourke joined MEMC as Senior Vice President and Chief Strategy Officer in October 2010. Prior to joining MEMC, Mr. O'Rourke served as Managing Director, Senior Analyst at Deutsche Bank Securities since 2004. Mr. O'Rourke also served in the U.S. Navy as a nuclear submarine officer and graduated from the U.S. Naval Academy, Annapolis, Maryland with a BS degree in Electrical Engineering, and did graduate work in Nuclear Engineering at the Naval Nuclear Power School in Orlando, Florida.

Mr. Ranhoff joined MEMC as a result of the acquisition of Solaicx in July 2010, where he was the former President and Chief Executive Officer. Mr. Ranhoff worked at Solaicx from May 2009 to July 2010. Prior to Solaicx, Mr. Ranhoff served as an Advisor and member of the board of directors of Spirox Corporation, a publicly traded semiconductor capital equipment, solar and services provider based in Taiwan from January 2007 to April 2009. Prior to that role, Mr. Ranhoff worked for 20 years at Credence Systems, a leading provider of automatic test equipment for the semiconductor industry, including as Chief Operating Officer and most recently as Chief Executive Officer.

There are no family relationships between or among any of the named officers and the directors.

32

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The narrative and tabular information regarding the market for our common equity and related stockholder matters required by this item is set forth under "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2012 Annual Report and under "Stockholders' Information" in our 2012 Annual Report, which information is incorporated herein by reference. We have not paid any dividends on our common stock for the last two fiscal years. Our amended corporate credit facility and our 2012 second lien term loan prevent the payment of dividends on our common stock without prior consent of the lenders. In addition, the indenture related to the senior notes requires that the company meet certain requirements, including those related to its leverage ratio and consolidated net income, in order to pay dividends.

The information required under this Item 5 concerning equity compensation plan information is set out below under Item 12 and is incorporated herein by this reference.

Item 6. Selected Financial Data

The tabular information (including the footnotes thereto) required by this item is set forth under "Five Year Selected Financial Highlights" in our 2012 Annual Report, which information is incorporated herein by this reference.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The information required by this item is set forth under "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2012 Annual Report, which information is incorporated herein by this reference.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The information required by this item is set forth under "Market Risk" included in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2012 Annual Report, which information is incorporated herein by this reference.

Item 8. Financial Statements and Supplementary Data

The information required by this item is set forth under "Consolidated Statements of Operations", "Consolidated Balance Sheets", "Consolidated Statements of Cash Flows", "Consolidated Statements of Stockholders' Equity", " Consolidated Statement of Comprehensive (Loss) Income", "Notes to Consolidated Financial Statements", "Report of Independent Registered Public Accounting Firm" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2012 Annual Report, all of which are incorporated herein by this reference.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

The information required by this item is set forth under "Controls and Procedures - Evaluation of Disclosure Controls and Procedures", "- Management's Report on Internal Control Over Financial Reporting" and "- Changes in Internal Control Over Financial Reporting" in our 2012 Annual Report, which information is incorporated herein by this reference.

Item 9B. Other Information

None.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

The information required by this item with respect to compliance with Section 16(a) of the Exchange Act will be set forth in the 2013 Proxy Statement under "Section 16(a) Beneficial Ownership Reporting Compliance" and is incorporated herein by this reference. The remaining information required by this item with respect to directors will be set forth in the 2013 Proxy Statement under "Director Qualifications" and "Information about Nominees and Continuing Directors" and is incorporated herein by this reference. Information required by this Item relating to our Code of Ethics and Audit Committee will be set forth in the 2013 Proxy Statement under "Board of Directors and Committees of the Board of Directors", which is incorporated herein by this reference. The remaining information required by this item with respect to executive officers is set forth in Part I of this Annual Report on Form 10-K under "Executive Officers of the Registrant", which is incorporated herein by this reference.

Item 11. Executive Compensation

The information regarding executive compensation required by this Item will be set forth in our 2013 Proxy Statement under the headings "Risk Compensation in Our Compensation Program", "Director Compensation", "Compensation Discussion and Analysis", "Report of the Compensation Committee", "Executive Compensation" and "Compensation Committee Interlocks and Insider Participation" and is incorporated herein by this reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information regarding beneficial ownership of our securities required by this Item will be set forth in our 2013 Proxy Statement under the headings "Security Ownership by Certain Beneficial Owners, Directors and Executive Officers" and is incorporated herein by this reference.

Equity Compensation Plans

The following table provides information about the Company’s common stock that may be issued upon exercise of options, warrants and rights under the Company’s equity compensation plans as of December 31, 2012.

	(a)	(b)		(c)
Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights(1)	Weighted-average exercise price of outstanding options, warrants and rights(2)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column(a))(1)
Equity compensation plans approved by security holders	25,679,566 shares of  common stock (3)	$	6.12	5,103,021 shares of  common stock (4)
Equity compensation plans not approved by security holders	0 shares of common stock	—		—
Total	25,679,566 shares of common stock	$	6.12	5,103,021 shares of  common stock

_________________________

(1) Number of shares is subject to adjustment for changes in capitalization for stock splits, stock dividends and similar events.

(2) Weighted average exercise price of outstanding options; excludes restricted stock units and performance-based restricted stock units.

(3) Includes 4,268,447 shares of MEMC common stock that may be issued upon vesting of restricted stock units.

(4) These shares are issuable under MEMC's 2010 Equity Incentive Plan.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information concerning related party transactions which is required by this Item will be set forth in our 2013 Proxy Statement under the heading "Certain Transactions" and is incorporated herein by reference. The information concerning director independence required by this Item will be set forth in our 2013 Proxy Statement under the heading "Board of Directors and Committees of the Board of Directors" and is incorporated herein by this reference.

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Item 14. Principal Accounting Fees and Services

The information required by this Item will be set forth in our 2013 Proxy Statement under the heading "Principal Accounting Firm Services and Fees" and is incorporated herein by this reference.

35

PART IV

Item 15. Exhibits, Financial Statement Schedules

(a)The following documents are filed as part of this report:

1.Financial Statements

The following consolidated financial statements of us and our subsidiaries and the Report of Independent Registered Public Accounting Firm of KPMG LLP are included in our 2012 Annual Report, and are incorporated herein by this reference:

Consolidated Statements of Operations—Years Ended December 31, 2012, 2011, and 2010.

Consolidated Statements of Comprehensive (Loss) Income—Years Ended December 31, 2012, 2011 and 2010.

Consolidated Balance Sheets—December 31, 2012 and 2011.

Consolidated Statements of Cash Flows—Years Ended December 31, 2012, 2011 and 2010.

Consolidated Statements of Stockholders' Equity—Years Ended December 31, 2012, 2011 and 2010.

Notes to Consolidated Financial Statements.

Report of Independent Registered Public Accounting Firm.

2.Financial Statements Schedules

None.

3.Exhibits

Exhibit No.	Description
3.1	Restated Certificate of Incorporation of MEMC Electronic Materials, Inc. (“the Company”) (Incorporated by reference to Exhibit 3-a of the Company’s Form 10-Q (File Number 001-13828) for the Quarter ended June 30, 1995)
3.2	Certificate of Amendment of Restated Certificate of Incorporation of the Company 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 the Company’s Form 10-Q (File Number 001-13828) for the Quarter ended June 30, 2000)
3.3	Certificate of Amendment of Restated Certificate of Incorporation of the Company 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 the Company’s Form 10-Q (File Number 001-13828) for the Quarter ended September 30, 2002)
3.4	Restated By-laws of the Company (Incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K filed on February 25, 2010)
4.1	Indenture (including the forms of notes), dated March 10, 2011, by and among MEMC Electronic Materials, Inc., the subsidiary guarantors named therein and U.S. Bank National Association, as trustee (Incorporated by reference to Exhibit 4.1 of the Company's Form 8-K filed March 10, 2011)
10.1	Joint Venture Agreement dated August 28, 1990 among the Company, Pohang Iron and Steel Company, Ltd. (“POSCO”) and Samsung Electronics Company, Ltd. (“Samsung”) (Incorporated by reference to Exhibit 10-c of Amendment No. 1 to the Company’s Form S-1 Registration Statement No. 33-92412)
10.2	First Amendment to Joint Venture Agreement dated December 9, 1993 among the Company, POSCO and Samsung (Incorporated by reference to Exhibit 10-d of Amendment No. 1 to the Company’s Form S-1 Registration Statement No. 33-92412)
10.3	Second Amendment to Joint Venture Agreement dated December 30, 1994 among the Company, POSCO and Samsung (Incorporated by reference to Exhibit 10-e of Amendment No. 1 to the Company’s Form S-1 Registration Statement No. 33-92412)

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10.4	MEMC Technology License Agreement dated as of July 31, 1995, between Albemarle Corporation and the Company (Incorporated by reference to Exhibit 10-tt of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 1995)
*10.5	Seller Technology License Agreement dated as of July 31, 1995, among Albemarle Corporation, the Company, and MEMC Pasadena, Inc. (Incorporated by reference to Exhibit 10-ll of the Company’s Form 10-K/A Amendment No. 2 (File number 001-13828) for the Year ended December 31, 1997)
*10.6	Technology Purchase Agreement dated as of July 31, 1995, among Albemarle Corporation and the Company (Incorporated by reference to Exhibit 10-mm of the Company’s Form 10-K/A Amendment No. 2 (File number 001-13828) for the Year ended December 31, 1997)
10.7	Ground Lease Agreement dated as of July 31, 1995, between Albemarle Corporation and MEMC Pasadena, Inc. (Incorporated by reference to Exhibit 10-nn of the Company’s Form 10-K/A Amendment No. 2 (File number 001-13828) for the Year ended December 31, 1997)
10.8	Amendment to Ground Lease Agreement dated as of May 31, 1997, between the Company, MEMC Pasadena, Inc., and Albemarle Corporation (Incorporated by reference to Exhibit 10-nn(1) of the Company’s Form 10-K/A Amendment No. 2 (File number 001-13828) for the Year ended December 31, 1997)
†10.9	MEMC Electronic Materials, Inc. 1995 Equity Incentive Plan as Amended and Restated on January 26, 2004 (Incorporated by reference to Exhibit 10-cc of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 2003)
†10.10	Form of Restricted Stock Unit Award Agreement (Incorporated by reference to Exhibit 10-cc(1) of the Company Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2004)
†10.11	Form of Stock Option and Restricted Stock Agreement (Incorporated by reference to Exhibit 10-t(1) of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 1995)
†10.12	Form of Stock Option and Performance Restricted Stock Agreement (Incorporated by reference to Exhibit 10-yy of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 1995)
†10.13	Form of Stock Option Agreement (Incorporated by reference to Exhibit 10-zz of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 1995)
†10.14	Form of Stock Option and Performance Restricted Stock Agreement (Incorporated by reference to Exhibit 10-nnn of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 1997)
†10.15	Form of Stock Option Agreement (Incorporated by reference to Exhibit 10-ooo of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 1997)
†10.16	Form of Stock Option Agreement (Non-employee Directors) (Incorporated by reference to Exhibit 10-ppp of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 1997)
†10.17	Form of Stock Option Agreement (Incorporated by reference to Exhibit 10-cc(7) of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 1999)
†10.18	Form of Stock Option Agreement (4-year cliff vesting) (Incorporated by reference to Exhibit 10-cc(9) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2002)
†10.19	Form of Stock Option Agreement (2-year cliff vesting) (Incorporated by reference to Exhibit 10-cc(10) of the Company’s Form 10-Q (File Number 001-13828) for the Quarter ended March 31, 2002)

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†10.20	Form of Stock Option Agreement (7-year cliff vesting) (Incorporated by reference to Exhibit 10-cc(11) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2002)
†10.21	Form of Stock Option Agreement (Outside Directors) (Incorporated by reference to Exhibit 10-cc(12) of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 2003)
†10.22	MEMC Electronic Materials, Inc. 2001 Equity Incentive Plan as Restated on January 24, 2007 (Incorporated by reference to Exhibit 10.22 of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.23	Form of Stock Option Agreement (4 year vesting) (Incorporated by reference to Exhibit 10-dd(1) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2002)
†10.24	Form of Stock Option Agreement (7 year cliff vesting) (Incorporated by reference to Exhibit 10-dd(2) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2002)
†10.25	Form of Stock Option Agreement (end of contract vesting) (Incorporated by reference to Exhibit 10-dd(3) of the Company’s Form 10-K (File number 001-13828) for the Year ended December 31, 2002)
†10.26	Stock Option Grant Agreement (Incorporated herein by reference to Exhibit 99.1 to the Company’s Form S-8 Registration Statement No. 333-83628 filed March 1, 2002)
†10.27	Stock Option Grant Agreement (Incorporated herein by reference to Exhibit 99.2 to the Company’s Form S-8 Registration Statement No. 333-83628 filed March 1, 2002)
†10.28	Written Description of MEMC Electronic Materials, Inc. Cash Incentive Plan Covering Executive Officers
†10.29	Stock Option Grant Agreement (Four Year Vesting) (Incorporated by reference to Exhibit 10-ii(2) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2002)
†10.30	Form of Restricted Stock Unit Award Agreement under the 2001 Equity Incentive Plan (Incorporated by reference to Exhibit 10.44 of the Company’s Form 10-K (File number 001-13828) for the year ended December 31, 2005)
†10.31	Form of Indemnification Agreement (Incorporated by reference to Exhibit 10-jj of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2002)
†10.32	Form of Indemnification Agreement (Incorporated by reference to Exhibit 10-jj(1) of the Company’s Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2003)
*10.33	Solar Wafer Supply Agreement, dated as of July 25, 2006, by and between the Company and Suntech Power Holdings Co. Ltd. (Incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2006)
*10.34	Solar Wafer Supply Agreement, dated as of October 25, 2006, by and between the Company and Gintech Energy Corporation (Incorporated by reference to Exhibit 10.46 of the Company’s Form 10-K (File number 001-13828)for the year ended December 31, 2006)
†10.35	Summary of Director Compensation
†10.36	Summary of Compensation Arrangements for Certain Named Executive Officers

38

*10.37	Solar Wafer Supply Agreement between Conergy AG and the Company dated October 25, 2007 (Incorporated by reference to Exhibit 10.42 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
*10.38	Amendment No. 1 to Solar Wafer Supply Agreement between Gintech Energy Corp. and the Company dated October 25, 2007 (Incorporated by reference to Exhibit 10.43 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.39	Form of MEMC Electronic Materials, Inc. Stock Unit Award Agreement for Directors (Incorporated by reference to Exhibit 10-44 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.40	Form of Amendment to MEMC Electronic Materials, Inc. Stock Unit Award Agreement for Directors (Incorporated by reference to Exhibit 10.45 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.41	Form of MEMC Electronic Materials, Inc. Stock Unit Award Agreement for Employees (Time Vesting) (Incorporated by reference to Exhibit 10.46 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.42	Form of Amendment to MEMC Electronic Materials, Inc. Stock Unit Award Agreement for Officers (Time Vesting) (Incorporated by reference to Exhibit 10.47 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
†10.43	Form of Amendment to MEMC Electronic Materials, Inc. Stock Unit Award Agreement for Officers (Performance Vesting) (Incorporated by reference to Exhibit 10.48 of the Company’s Annual Report on Form 10-K (File number 001-13828) for the Year ended December 31, 2007)
*10.44	Amended and Restated STF Supply Agreement dated as of April 30, 2007, by and between the Company and PCS Phosphate Company, Inc. (Incorporated by reference to Exhibit 10.49 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2008)
*10.45	Solar Wafer Supply Agreement dated as of July 9, 2008, by and between MEMC Singapore Pte. Ltd. and Tainergy Tech Co., Ltd. (Incorporated by reference to Exhibit 10.50 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2007)
*10.46	Amendment Number 1 to Solar Wafer Supply Agreement, by and between MEMC Singapore Pte. Ltd. and Conergy AG, dated as of July 10, 2008. (Incorporated by reference to Exhibit 10.51 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2007)
†10.47	Employment Agreement between the Company and Ahmad R. Chatila dated February 4, 2009 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on February 5, 2009)
*10.48	Amendment Number 1 to Solar Wafer Supply Agreement, dated February 5, 2009, by and between MEMC Singapore Pte. Ltd. and Suntech Power Holdings Co., Ltd. (Incorporated by reference to Exhibit 10.53 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2009)
*10.49	Amendment Number 3 to Solar Wafer Supply Agreement, dated February 16, 2009, by and between MEMC Singapore Pte. Ltd. and Gintech Energy Corporation (Incorporated by reference to Exhibit 10.54 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2009)
*10.50	Binding Term Sheet, Solar Plant Company between MEMC Electronic Materials, Inc. and Q-Cells SE, dated as of June 26, 2009 (Incorporated by reference to Exhibit 10.56 to the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2009)

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*10.51	Amendment Number 2 to Solar Wafer Supply Agreement, by and between the Company and Suntech Power Holdings Co., Ltd., dated as of July 23, 2009 (Incorporated by reference to Exhibit 10.58 to the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2009)
*10.52	Amendment No. 4 to Solar Wafer Supply Agreement, dated as of September 22, 2009, by and between the Company and Gintech Energy Corporation (Incorporated by reference to Exhibit 10.57 to the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2009)
*10.53	Agreement and Plan of Merger, by and among the Company, Sierra Acquisition Sub, LLC, Sun Edison LLC, and the Unitholder Representatives, dated as of October 22, 2009 (Incorporated by reference to Exhibit 10.59 to the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2009)
*10.54	Amendment to Agreement and Plan of Merger, dated as of November 11, 2009 by and among the Company, Sierra Acquisition Sub, LLC, Sun Edison LLC and the Representatives listed therein (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 17, 2009)
*10.55	Form of Blocker Purchase Agreement entered into with each of MissionPoint SE Parallel Fund Corp. and the stockholders listed therein; Greylock XII Corp. and the stockholders listed therein; Black River CEI Subsidiary 6 LLC and the equityholder listed therein; and NEA 12 SE, LLC and the equityholder listed therein (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 17, 2009)
10.56	Registration Rights Agreement, by and among the Company, Carlos Domenech, Peter J. Lee, Thomas Melone, and the Preferred Unitholders of Sun Edison dated November 20, 2009 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.57	MEMC Electronic Materials, Inc. 2009 Special Inducement Grant Plan (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.58	Form of MEMC Electronic Materials, Inc. 2009 Special Inducement Grant Plan Restricted Stock Unit Award Agreement (performance-based vesting, employees without an employment agreement) (Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.59	Form of MEMC Electronic Materials, Inc. 2009 Special Inducement Grant Plan Restricted Stock Unit Award Agreement (performance-based vesting, employees with an employment agreement) (Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.60	Form of MEMC Electronic Materials, Inc. 2009 Special Inducement Grant Plan Restricted Stock Unit Award Agreement (time-based vesting, employees with an employment agreement) (Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.61	Form of MEMC Electronic Materials, Inc. 2009 Special Inducement Grant Plan Restricted Stock Unit Award Agreement (time-based vesting, employees without an employment agreement) (Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K (File number 001-13828) filed on November 23, 2009)
†10.62	MEMC Electronic Materials, Inc. 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.1 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
†10.63	Form of Stock Option Award Agreement (four-year vesting) under the 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.2 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)

40

†10.64	Form of Restricted Stock Award Agreement (outside directors) under the 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.3 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
†10.65	Form of Restricted Stock Award Agreement (time-based vesting) under the 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.4 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
†10.66	Form of Restricted Stock Award Agreement (performance-based vesting) under the 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.5 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
†10.67	Form of Performance Unit Award under the 2010 Equity Incentive Plan (Incorporated by reference to Exhibit 99.6 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
†10.68	MEMC Electronic Materials, Inc. 2001 Equity Incentive Plan, as amended and restated on February 26, 2010 (Incorporated by reference to Exhibit 99.7 of the Company’s Current Report on Form 8-K (File number 001-13828) filed on April 22, 2010)
*10.69	Amendment Number 2 to Solar Wafer Supply Agreement by and between MEMC Singapore Pte. Ltd and Conergy AG, dated as of January 24, 2010 (Incorporated by reference to Exhibit 10.66 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2010)
†10.70	Amendment to Employment Agreement between the Company and Ahmad Chatila dated January 29, 2010 (Incorporated by reference to Exhibit 10.67 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2010)
*10.71	Agreement and Plan of Merger by and among the Company, Oscar Acquisition Sub, Inc., Solaicx, and Shareholder Representative Services, LLC, as the Representative, dated May 21, 2010 (Incorporated by reference to Exhibit 10.68 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2010)
*10.72	Framework Agreement by and among SunEdison LLC, FREI Sun Holdings (Cayman) Ltd., FREI Sun Holdings (US) LLC, SunEdison Reserve US, L.P. and SunEdison Reserve International, L.P., dated as of May 21, 2010 (Incorporated by reference to Exhibit 10.69 of the Company’s Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2010)
*10.73	Joint Venture Agreement dated as of February 15, 2011 by and among MEMC Singapore Pte. Ltd. and Samsung Fine Chemicals Ltd. (Incorporated by reference to Exhibit 10.82 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2011)
10.74	Amended and Restated Credit Agreement dated as of March 23, 2011 by and between MEMC, Bank of America, N.A., as administrative agent, lender, swing line lender and letter of credit issuer, and the various lenders signatory thereto (Incorporated by reference to Exhibit 10.83 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2011)
10.75	Purchase Agreement dated as of June 23, 2011 by and among Sun Edison LLC, FREI Sun Holdings (Cayman) Ltd., and FREI Sun Holdings (US) LLC (Incorporated by reference to Exhibit 10.84 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2011)
10.76	Termination Agreement dated as of June 30, 2011 by and between MEMC Singapore Pte. Ltd. and Suntech Power Holdings Co., LTD. (Incorporated by reference to Exhibit 10.85 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2011)

41

†*10.77	Stock Sale Agreement dated as of August 3, 2011 by and among MEMC, MEMC Holdings Corporation, Fotowatio Renewable Ventures, S.L. and Fotowatio S.L. (Incorporated by reference to Exhibit 10.86 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2011)
10.78	First Amendment dated as of September 28, 2011 to Amended and Restated Credit Agreement dated as of March 23, 2011 by and between MEMC, Bank of America, N.A., as administrative agent, lender, swing line lender and letter of credit issuer, and the various lenders signatory thereto (Incorporated by reference to Exhibit 10.87 of the Company's Quarterly Report on Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2011)
10.79	Second Amendment, dated as of February 28, 2012, to Amended and Restated Credit Agreement dated as of March 23, 2011 by and between MEMC, Bank of America, N.A., as administrative agent, lender, swing line lender and letter of credit issuer, and the various lenders signatory thereto (Incorporated by reference to Exhibit 10.88 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended March 31, 2012)
†10.80	MEMC Electronic Materials, Inc. 1995 Equity Incentive Plan as Amended and Restated on April 4, 2012 (Incorporated by reference to Exhibit (d)(1) of MEMC's Tender Offer Statement on Schedule TO (File number 005-52339) filed on July 17, 2012)
†10.81	MEMC Electronic Materials, Inc. 2001 Equity Incentive Plan as Amended and Restated on April 4, 2012 (Incorporated by reference to Exhibit (d)(2) of MEMC's Tender Offer Statement on Schedule TO (File number 005-52339) filed on July 17, 2012)
†10.82	MEMC Electronic Materials, Inc. 2010 Equity Incentive Plan as Amended and Restated on April 4, 2012 (Incorporated by reference to Exhibit (d)(3) of MEMC's Tender Offer Statement on Schedule TO (File number 005-52339) filed on July 17, 2012)
10.83	Third Amendment, dated as of May 8, 2012, to Amended and Restated Credit Agreement dated as of March 23, 2011 by and between MEMC, Bank of America, N.A., as administrative agent, lender, swing line lender and letter of credit issuer, and the various lenders signatory thereto (Incorporated by reference to Exhibit 10.92 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2012)
†10.84	Separation Agreement and General Release, dated as of June 14, 2012, by and between MEMC Electronic Materials, Inc. and Mark J. Murphy (Incorporated by reference to Exhibit 10.93 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2012)
†10.85	Separation Agreement and General Release, dated as of June 16, 2012, by and between MEMC Electronic Materials, Inc. and Kenneth H. Hannah Jr. (Incorporated by reference to Exhibit 10.94 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2012)
*10.86	Second Amendment to the Amended & Restated STF Supply Agreement, dated as of June 30, 2012, by and between the Company and PCS Phosphate Company, Inc. (Incorporated by reference to Exhibit 10.95 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended June 30, 2012)
10.87	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 (File number 001-13828) filed on October 2, 2012)
10.88	Guaranty Agreement, dated September 28, 2012, 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 (File number 001-13828) filed on October 2, 2012)
10.89	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 (File number 001-13828) filed on October 2, 2012)

42

10.90	Termination Agreement dated as of September 25, 2012 by and among the Company, MEMC Singapore Pte. Ltd. and Conergy AG (Incorporated by reference to Exhibit 10.99 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2012)
10.91	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. (Incorporated by reference to Exhibit 10.100 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2012)
10.92	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. (Incorporated by reference to Exhibit 10.101 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2012)
10.93	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. (Incorporated by reference to Exhibit 10.102 of the Company's Form 10-Q (File number 001-13828) for the Quarter ended September 30, 2012)

13	Selected pages from the Company's 2012 Annual Report to Stockholders
21	Subsidiaries of the Company
23	Consent of KPMG LLP
31.1	Certification by the Chief Executive Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification by the Chief Financial Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification by the Chief Executive Officer and Chief Financial Officer of the Company 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

_________________________

* Confidential treatment of certain portions of these documents has been requested or granted.

† These exhibits constitute management contracts, compensatory plans and arrangements.

43

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		MEMC ELECTRONIC MATERIALS, INC.
		By:	/s/ Ahmad R. Chatila
Date:	March 1, 2013		Ahmad R. Chatila President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons, on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Ahmad R. Chatila	President, Chief Executive Officer and Director (Principal executive officer)	March 1, 2013
Ahmad R. Chatila
/s/ Brian Wuebbels	Executive Vice President and Chief Financial Officer (Principal financial officer and principal accounting officer)	March 1, 2013
Brian Wuebbels
/s/ Emmanuel T. Hernandez	Chairman of the Board	March 1, 2013
Emmanuel T. Hernandez
/s/ Antonio R. Alvarez	Director	March 1, 2013
Antonio R. Alvarez
/s/ Peter Blackmore	Director	March 1, 2013
Peter Blackmore
/s/ Jeffry N. Quinn	Director	March 1, 2013
Jeffry N. Quinn
/s/ Steven V. Tesoriere	Director	March 1, 2013
Steven V. Tesoriere
/s/ Marshall Turner	Director	March 1, 2013
Marshall Turner
/s/ James B. Williams	Director	March 1, 2013
James B. Williams

44

EXHIBIT INDEX

The following exhibits are filed as part of this report:

Exhibit No.	Description
10.28	Written Description of MEMC Electronic Materials, Inc. Cash Incentive Plan Covering Executive Officers
10.35	Summary of Director Compensation
10.36	Summary of Compensation Arrangements for Certain Named Executive Officers
13	Selected pages from the Company's 2012 Annual Report to Stockholders
21	Subsidiaries of the Company
23	Consent of KPMG LLP
31.1	Certification by the Chief Executive Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification by the Chief Financial Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification by the Chief Executive Officer and Chief Financial Officer of the Company 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

45

EX-10.28

Exhibit 10.28

Written Description of

MEMC Electronic Materials, Inc. Cash Incentive Plan

Covering Executive Officers

MEMC Electronic Materials, Inc. ("MEMC" or the "Company") maintains a cash incentive plan that covers the Chief Executive Officer and the Company's other executive officers. Under current practice, the Compensation Committee (the "Committee") makes annual cash awards under the plan to executive officers to recognize and reward Company and individual performance.

For each participant, the Committee establishes threshold, target and maximum bonus levels that are defined as a percentage of the participant's base salary. The “threshold” level of performance for a particular performance goal represents the lowest level of performance for which any bonus would be earned on that performance goal. The "maximum" level of performance represents the level for which the maximum bonus would be earned for that particular goal, and the "target" represents the target level of performance. The actual bonus, if any, attributable to each performance goal is calculated based on the actual performance compared to these “threshold," "target" and "maximum" performance levels. The "threshold," "target" and "maximum" levels for each category of executives under the plan are generally as follows:

	Threshold	Target	Max
CEO	63%	125%	250%
EVP	38%	75%	150%
SVP	25%	50%	100%
VP	15-20%	30-40%	50-80%

The plan has two main components: a Company milestone component and a personal goal component. The Company-based and personal performance metrics account for varying levels of the total potential award under the 2012 short term incentive plan as follows:

	Company Metrics	Personal Metrics
CEO,	80%	20%
EVP, SVP	80%	20%
VP	60%	40%

As a result, the bonus paid to the CEO, if any, is 80% tied to Company metrics. The Company's executive officer s have a number of quarterly, semi-annual and/or annual performance objectives including those tied to the Company's financial performance, along with a number of individual performance and financial objectives applicable to each executive officer's functional area. These objectives are reviewed and approved by the Committee on an annual basis. Based on the achievement against these performance objectives, the executive officers are entitled to receive cash awards, which are generally paid on an annual basis.

The plan is non-contractual. The Company maintains the right to terminate or amend the cash incentive plan at any time.

EX-10.35

Exhibit 10.35

Summary of Director Compensation

Set forth below is a summary of the compensation paid by MEMC Electronic Materials, Inc. (the “Company”) to its outside directors who are not employees of the Company or any subsidiary of the Company. Directors that are also employees of the Company receive no additional compensation for their service as a director.

Initial Election to the Board of Directors

Upon initial election to the MEMC Board of Directors, all outside directors are awarded non-qualified stock options for 25,000 shares of MEMC common stock. These options will have a strike price equal to the market value at date of grant and vest ratably over four years.

Annual Compensation

Restricted Stock Units (RSUs)

Annually (as of the date of the Annual Stockholder Meeting for that year), each person whose term on the Board of Directors extends for an additional year or who is expected to be nominated for re-election at such Annual Meeting of Stockholders, shall be awarded restricted stock units (RSUs) for shares of MEMC common stock having a value of approximately $185,000 on the date of grant (based on the closing price of MEMC common stock on the date of grant). Each RSU shall represent the right to receive one share of MEMC common stock. The actual number of RSUs to be awarded shall be determined in increments of 100 RSUs such that the value of the MEMC common stock underlying the RSUs is as close to $185,000 as possible.

The RSUs shall vest 100% on the first anniversary of the date of grant.

Cash Compensation

The directors shall receive the following cash compensation:

An annual retainer of $50,000.

An additional retainer of $50,000 for the Chairman of the Board.

An additional retainer of $40,000 for the Chairman of the Audit Committee and an additional retainer of $10,000 for each other member of the Audit Committee.

An additional retainer of $20,000 for the Chairman of the Compensation Committee and an additional retainer of $5,000 for each other member of the Compensation Committee.

An additional retainer of $5,000 for the Chairman of the Nominating and Corporate Governance Committee.

An additional fee of $1,000 for each Board and Committee meeting attended.

Reimbursable Expenses

All reasonable out-of-pocket expenses incurred by a director for attending Board or Committee meetings will be reimbursed by the Company.

EX-10.36

Exhibit 10.36

Summary of Compensation Arrangements for Certain Named Executive Officers

Set forth below is a summary of the compensation paid by MEMC Electronic Materials, Inc. (the “Company”) to the executive officers to be named in the Company's 2013 annual proxy statement who are not covered by current employment agreements, as of the date of filing of the Company's Annual Report on Form 10-K for the year ended December 31, 2012 (the “Form 10-K”) and are continuing as an executive officer of the Company as of February 15, 2013. None of the below executive officers has an employment agreement with the Company. Each of these executive officers is an employee at will whose compensation and employment status may be changed at any time in the discretion of the Company's Board of Directors

Base Salaries. These executive officers currently receive base salaries in the amounts indicated below:

Name and Position	2012 Base Salary Amount
Brian Wuebbels, Executive Vice President & Chief Financial Officer	$	400,000
Carlos Domenech, Executive Vice President; President-Solar Energy	$	425,000
Shaker Sadasivam, Executive Vice President; President-Semiconductor Materials	$	424,400
Dave Ranhoff, Senior Vice President, Sales & Marketing	$	370,800

The Compensation Committee adjusts these base salaries from time to time as the Committee deems appropriate each year, generally annually. The Committee reviews and discusses the written performance appraisal for each executive officer with the Chief Executive Officer. The above information reflects the base salaries for our named executive officers approved by the Committee in February 2012.

Incentive Awards. These executive officers are also eligible to participate in the Company's incentive compensation plans as provided in the terms of such plans, including the Company's short term incentive awards plan (which provides for cash incentive awards) and the Company's long-term incentive awards plan (e.g., the Company's 2001 and 2010 Equity Incentive Plans). Such plans, and any forms of awards thereunder providing for material terms, are included as exhibits to the Form 10-K as appropriate.

Pension Plan. These executive officers are also eligible to participate in the Company Pension Plan on the same terms as the Company's other covered employees. Because he commenced employment after December 31, 2001, Messrs. Wuebbels, Domenech and Ranhoff are not covered by the MEMC Pension Plan.

Relocation Payments. From time to time the Company makes payments to executive officers to cover relocation expenses.

EX-13

Exhibit 13

Five Year Selected Financial Highlights

The following data has been derived from our annual consolidated financial statements, including the consolidated balance sheets and the related consolidated statements of operations, cash flows, and stockholders’ equity and the notes thereto. The information below should be read in conjunction with our consolidated financial statements and notes thereto including Note 2 related to significant accounting policies.

	2012			2011 (1)			2010 (1)		2009			2008
(in millions, except per share and employment data)
Statement of Operations Data:
Net sales(2)	$	2,529.9		$	2,715.5		$	2,239.2	$	1,163.6		$	2,004.5
Gross profit	335.6			294.9			337.1		128.1			1,004.8
Marketing and administration(3)	306.2			352.8			267.0		161.9			106.5
Research and development	71.8			87.5			55.6		40.4			40.8
Goodwill impairment charges (see Note 10)	—			440.5			—		—			—
Restructuring (reversals) charges (see Note 3)	(83.5		)	350.7			5.3		28.4			4.3
Gain on receipt of property, plant and equipment (see Note 3)	(31.7		)	—			—		—			—
Long-lived asset impairment charges (see Note 9)	19.6			367.9			—		24.6			—
Operating income (loss)	57.2			(1,300.5		)	21.1		(127.2		)	853.2
Non-operating expense (income)(4)	138.7			83.6			33.6		(27.0		)	268.2
Net (loss) income attributable to MEMC stockholders(5),(6),(7)	(150.6		)	(1,536.0		)	34.4		(68.3		)	387.4
Basic (loss) income per share	(0.66		)	(6.68		)	0.15		(0.31		)	1.71
Diluted (loss) income per share	(0.66		)	(6.68		)	0.15		(0.31		)	1.69
Balance Sheet Data:
Cash and cash equivalents	572.6			585.8			707.3		632.7			988.3
Restricted cash and short-term and long-term investments(8)	136.0			178.9			103.7		317.2			432.8
Working capital	323.4			449.0			453.2		740.5			981.6
Total assets	4,701.6			4,881.6			4,611.9		3,566.5			2,936.7
Long-term debt and capital lease obligations (including current portion)	762.1			571.4			26.9		30.6			32.2
Solar energy system debt, financings and capital lease obligations	1,606.2			1,355.4			655.8		386.0			—
Total MEMC stockholders’ equity	575.3			737.9			2,251.7		2,168.6			2,082.0
Other Data:
Capital expenditures	139.0			452.5			352.0		225.4			303.6
Construction of solar energy systems	346.9			598.1			280.1		28.0			—
Employees	5,633			6,350			6,500		5,100			4,900

_________________________

⁽¹⁾  Includes the operating results of various acquisitions during 2010 and 2011 since their acquisition date. See Note 4.

⁽²⁾  Includes $37.1 million of revenue recognized in 2012 for the Conergy termination. Similarly, $175.7 million of revenue was recognized in 2011 for the Suntech contract resolution. See Note 17.

⁽³⁾  During the year ended December 31, 2012, we recorded a $12.8 million charge to income to adjust the fair value of contingent consideration and during the year ended December 31, 2011 we recorded a favorable adjustment of $26.3 million to adjust the fair value of contingent consideration. The adjustments were recorded as an increase and reduction to marketing and administration expense, respectively.

1

⁽⁴⁾  (Losses) gains of $(0.2) million, $(4.8) million, $(14.0) million, $5.4 million and $(292.5) million were recorded to non-operating expense (income) in 2012, 2011, 2010, 2009 and 2008, respectively, due to the mark-to-market adjustment related to a warrant received from Suntech. Also included in 2012 is a $3.6 million impairment charge, compared to $11.6 million in 2011, of an investment accounted for under the cost method. See Note 6.

⁽⁵⁾  Includes $67.3 million of impairment charges in 2011 from our investment in two joint ventures. See Note 6.

⁽⁶⁾  Includes net income tax expense of $94.8 million and $368.5 million recorded in 2012 and 2011, respectively, for the net valuation change in deferred tax assets. See Note 14.

⁽⁷⁾  Includes net income tax benefit of $15.5 million in 2010 resulting from conclusion of the Internal Revenue Service (“IRS”) examination for the 2007 and 2006 years. Also includes additional income tax expense of $18.1 million in 2009 related to various cost allocation and taxable income adjustments attributable to our foreign operations and reduction in income tax expense of $29.5 million in 2008 due to the closure of the IRS examination for the 2005 and 2004 years.

⁽⁸⁾  Amount includes investments measured at fair value on a recurring basis and time deposits, and excludes investments accounted for under the equity method and cost investments.

2

Management’s Discussion and Analysis of Financial Condition and Results of Operations

EXECUTIVE OVERVIEW

MEMC is a global leader in the development, manufacture, and sale of silicon wafers and a major developer and seller of photovoltaic energy solutions. Through SunEdison, MEMC is one of the world’s leading developers of solar energy projects and, we believe, one of the most geographically diverse. MEMC’s technology leadership in silicon and downstream solar are enabling the company to expand its customer base and lower costs throughout the silicon supply chain.

The solar industry experienced a significant downturn in the second half of 2011, including sharp reductions in pricing of polysilicon, solar wafers, solar modules, solar cells, and to a lesser extent, solar systems, leading to a dramatic decline in profitability versus prior years. As a result, during the fourth quarter of 2011, in order to better align our business to current and expected market conditions in the semiconductor and solar markets, as well as to improve the company's then overall cost competitiveness and increase cash flow generation across all segments, MEMC committed to a series of actions to reduce the company's global workforce, right size its production capacity and accelerate operating cost reductions in 2012 and beyond (the “2011 Global Plan”).  See Note 3 for further discussion of the 2011 Global Plan.

During 2012, we executed on our 2011 Global Plan. As part of our efforts, in September 2012, we executed settlement agreements with Evonik to settle disputes arising from our early termination of two take-or-pay supply agreements. We forfeited a deposit of $10.2 million and will pay Evonik a total of 70 million euros. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrual was made resulting in $69.2 million of income within restructuring charges. Additionally, on December 30, 2012 as part of the settlement with Evonik, we obtained title to a chlorosilanes plant which resulted in the recognition of $31.7 million of income in the fourth quarter of 2012.

We realized annual pre-tax operating benefits upon the substantial completion of our restructuring activities during 2012 of approximately $145 million. We now expect annual pre-tax operating benefits in 2013 to increase to approximately $200 million as the full benefits of our actions are realized.

Also in September 2012, we entered into a $200 million second lien term loan with a five year maturity. We used the net proceeds for general corporate purposes, including working capital, capital expenditures, and the construction of solar power projects. In addition, we continue to maintain our credit facility which provides for total borrowings of up to $400 million. See Note 11 for further discussion. We expect continued growth in our downstream solar business, which will require us to access the debt and capital markets in the future to fund related working capital needs, with most of such debt expected to be non-recourse debt.

In light of current and anticipated market conditions, we continue to focus on effective cash management and liquidity. In addition to taking the actions set forth in the 2011 Global Plan, we have developed a strategic plan for the ongoing operation of our businesses designed to continue to improve our performance and address the challenges within our industries. Our business strategy is designed to address the most significant opportunities and challenges facing the company. In particular, our key challenges include:

• Managing cash flow and mitigating liquidity risks, including the completion of a rigorous assessment of our current liquidity, the level of committed financing prior to commencement of solar project construction and managing the timing of expenditures for the construction of solar energy systems as compared to receipts from final sale or financing;

• Continuing to execute on our 2011 Global Plan;

• Focusing on semiconductor operating cash flows and further streamlining those operations; and

• Optimizing solar project pipeline development and achieving future growth in solar systems sales globally and across all platforms.

From January 1, 2010 until December 31, 2011, MEMC was organized by end market, with three business segments: Semiconductor Materials, Solar Materials, and Solar Energy. Semiconductor Materials provides silicon wafers ranging from 100 millimeter (4 inch) to 300 millimeter (12 inch) as the base material for the production of semiconductor devices. Solar Materials manufactured and sold silicon wafers for solar applications, primarily 156 millimeter. Solar Energy was comprised of the SunEdison solar energy business unit which designed, developed, and constructed solar energy systems. As part of the 2011 Global Plan, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date, we have been engaged in two reportable segments: Semiconductor Materials and Solar Energy. These consolidated financial statements and related footnotes, including prior year financial information, are presented based on two reporting segments for all periods presented.

3

Semiconductor Materials Segment

Sales in the Semiconductor Materials segment decreased by 10.3% in 2012 from 2011 primarily due to lower pricing on flat volume, which was caused by the continued decline in the semiconductor industry. Profitability improved in 2012 as the price declines were offset by the cost improvement realized from the 2011 Global Plan restructuring efforts, the non-recurring unfavorable impact of the Japan earthquake during the first half of 2011 and other 2012 productivity improvements.

During 2012, we expanded our capabilities related to the production of 200mm wafers at our Ipoh, Malaysia plant and have completed actions to consolidate worldwide semiconductor production equipment from the United States. Complementing this increase in capacity is the completion of the first phase of installation of 300mm production capacity at our Korean facility.

As part of the 2011 Global Plan we committed to actions to reduce overall manufacturing costs across our global semiconductor sites, and to realign certain general and administrative expenses due to various market developments. Future profitability is heavily dependent on the success of these restructuring actions, which will continue into 2013.

Solar Energy Segment

Conditions in the entire solar industry deteriorated during 2011, and continued into 2012, including the selling prices of solar energy systems. However, SunEdison continued its trend of sales growth in 2012 and the lower average sales prices were partially offset by lower material costs. Solar energy system sales increased in North America through ground mount projects in the U.S. and Canada. We have also started to develop several projects in Asia and continue to evaluate project development opportunities in South America, the Middle East and Africa. During 2012, revenues were recognized for direct sales on 44 projects totaling 291.7 megawatts ("MW"), compared to 33 projects totaling 168.6MW in 2011. The 291.7MW in 2012 include 52.1MW of projects sold in Europe that were classified as held for sale at the end of 2011.

For the year, solar wafer revenue declined by 71% in 2012 versus fiscal 2011 due to the company's strategic shift to supply wafers primarily for internal consumption by SunEdison. These declines were offset to some extent by external polysilicon and solar module sales during the year. Sales of polysilicon were made during the first quarter of 2012 to reduce our overall raw material inventory. Sales of modules and wafers are made on an opportunistic basis considering the demand in our downstream solar energy system business. Going forward, sales of solar wafers, modules and other solar materials to external parties will continue to be made on an opportunistic basis depending on demand and timing of internal needs in our solar energy business.

In 2012, SunEdison secured multiple non-recourse sources of financing for solar energy systems through equity investments by joint venture partners, sale and leaseback facilities, a revolving line of credit, and construction and term loan facilities. As a result of various amendments to our non-recourse project construction revolver we reduced the total capacity to $150.0 million as of December 31, 2012. See Note 11. We believe that access to competitive capital financing will remain a key differentiator in the solar energy industry, and we are continuously expanding our financing breadth and global capabilities in order to secure project financing for 2013 and beyond. The total capital necessary will be driven primarily by the amount of megawatts of energy producing assets installed and interconnected. We expect year end cash on hand, 2013 operating cash flows, project finance debt, and our corporate credit facility to provide sufficient capital to support the construction phase of currently planned projects for 2013 and otherwise meet capital needs for 2013. We expect ongoing efforts to secure more capital, including sources of non-recourse project capital, to generate sufficient resources to support growth. However, there can be no assurances that such financing will be available to us or at terms that we find acceptable.

As of December 31, 2012, SunEdison had a project pipeline of approximately 2.6 gigawatts (“GW”), as compared to 3.0GW of project pipeline as of December 31, 2011. The 2012 decrease in pipeline is due to projects built and interconnected in 2012 and our decision to allow land options in an emerging market to expire, offset partially by organic growth. The December 31, 2012 project pipeline includes projects under construction totaling 73MW. A solar energy system project is classified as "pipeline" when SunEdison has a signed or awarded power purchase agreement (PPA) or other energy off-take agreement or has achieved each of the following three items: site control, an identified interconnection point with an estimate of the interconnection costs, and an executed energy off-take agreement or the determination that there is a reasonable likelihood that an energy off-take agreement will be signed. "Under construction" refers to projects within pipeline, in various stages of completion, which are not yet operational. There can be no assurance that pipeline will be converted into completed projects or generate revenues or that we can obtain the necessary financing to construct these projects.

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RESULTS OF OPERATIONS

Net sales by segment in the years ended December 31, 2012, 2011 and 2010 were as follows:

Net Sales	2012		2011		2010
Dollars in millions
Semiconductor Materials	$	917.5	$	1,023.1	$	992.6
Solar Energy	1,612.4		1,692.4		1,246.6
Total Net Sales	$	2,529.9	$	2,715.5	$	2,239.2

Semiconductor Materials

The decrease in Semiconductor Materials net sales in 2012 compared to 2011 was due to wafer price decreases totaling $101.6 million caused by the continued downturn in the semiconductor industry. Price decreases occurred across all wafer diameters. Overall volumes were flat as compared to 2011 as 300mm volume increases were offset by lower demand on 200mm and smaller diameters, while product mix had a minimal impact. The 2012 overall average wafer selling prices were approximately 10.0% lower than the average selling prices for 2011. Average wafer selling prices in 2013 are expected to remain flat from continued pricing pressures even though we expect improved product mix to a higher proportion of 300mm wafers.

Solar Energy

The decrease in Solar Energy sales from 2011 to 2012 reflects declines in solar wafer sales of $497.5 million and the absence of $175.7 million associated with the favorable Suntech contract resolution in 2011, which did not recur in 2012. The decline in solar wafer sales was expected as we implemented our plans to primarily support our internal needs for our downstream solar energy business. These declines were offset by the increase in sales of solar energy systems and to a lesser extent, external module sales as well as $37.1 million of revenue related to a favorable contract termination with Conergy. Sales of solar energy systems totaled 291.7MW during 2012 versus 168.6MW during 2011. Also included in 2012 and 2011 sales is project revenue recognized under the percentage of completion and installment methods of accounting of $120.5 million and $82.5 million, respectively. See "Summary of Significant Accounting Policies - Revenue Recognition" in Note 2. Also contributing to the increase in net sales was an increase in energy production revenue from $74.9 million in 2011 to $125.8 million in 2012. Additionally, in the fourth quarter 2012, there was $54.4 million of revenue recognized related to profit deferrals on a power guarantee that expired for a 70MW project in Italy that was sold in the fourth quarter of 2010. No similar amounts were recognized in 2011.

As of December 31, 2012 and 2011, $239.5 million and $138.0 million, respectively, of revenue related to solar energy system direct sales was deferred as required under real estate revenue recognition requirements because of certain related guarantees and indemnifications. Solar Energy segment net sales do not include cash proceeds received by us from financing sale-leasebacks of $294.5 million and $511.9 million during 2012 and 2011, respectively, because these transactions resulted in the retention of assets on our balance sheet along with the related non-recourse debt. See Note 2. The decline of financing sale-leasebacks of $217.4 million during 2012 is attributable to the change in mix between financing sale-leasebacks and direct sales.

Sales increased in 2011 over 2010 as a result of both increased solar wafer revenue as well as increased solar energy system and energy sales. The increase in solar wafer sales is the result of an increase in solar wafer volume increases and $175.7 million recognized for the Suntech contract resolution, offset partially by solar wafer price declines. Due to the downturn in the solar wafer market, our solar wafer average selling prices in 2011 were approximately 21% lower than 2010 and were 53% lower in the fourth quarter of 2011 as compared to the fourth quarter of 2010. The increase in solar energy system sales from 2010 to 2011 reflects the sale of solar energy systems totaling 168.6MW during 2011 versus 83.4MW during 2010. Also included in 2011 sales is project revenue recognized under the percentage of completion and installment method of $82.5 million, with no corresponding projects eligible for recognizing revenues under these methods in 2010. Also contributing to the increase in net sales was a $26.6 million increase in energy production revenue from $48.3 million in 2010 to $74.9 million in 2011. As of December 31, 2011 and 2010, $138.0 million and $63.2 million, respectively, of revenue related to solar energy system direct sales was deferred because of certain guarantees and indemnifications.

Net sales do not include cash proceeds from financing sale-leasebacks of $160.8 million during 2010 because these transactions resulted in the retention of assets on our balance sheet along with the related non-recourse debt. See Note 2. The increase of

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$351.1 million of financing sale-leasebacks in 2011 compared to 2010 is attributable to continued growth in our North American markets including a higher mix of larger utility scale projects.

Net Sales by Geographic Area

We operate in all the major semiconductor and solar-producing regions of the world, with approximately 71% of our 2012 net sales to customers located outside the United States. Net sales by geographic region for each of the last three years were as follows:

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
United States	$	735.3	$	447.5	$	242.8
China	82.8		598.8		415.8
Korea	198.8		237.1		176.9
Taiwan	408.4		530.0		549.4
Italy	234.2		375.6		385.3
Canada	248.6		104.9		4.4
Spain	175.8		42.3		2.0
Other foreign countries	446.0		379.3		462.6
Total	$	2,529.9	$	2,715.5	$	2,239.2

Net sales are attributed to countries based on the location of the customer.

Gross Profit	2012			2011			2010
Dollars in millions
Cost of Goods Sold	$	2,194.3		$	2,420.6		$	1,902.1
Gross Profit	335.6			294.9			337.1
Gross Margin Percentage	13.3		%	10.9		%	15.1		%

For the year ending December 31, 2012, the Semiconductor Materials segment's gross profit dollars were negatively impacted by declines in pricing, partially offset by lower overhead costs as part of our restructuring efforts in the 2011 Global Plan. The Solar Energy segment's margins in 2012 were positively impacted by the $37.1 million of revenue on the Conergy termination, as well as $54.4 million of revenue recognized related to profit deferrals for a power guarantee that expired for a 70MW project in Italy that was sold in the fourth quarter of 2010. See Note 17. Additionally, gross profit was positively impacted by an increase in sales of solar energy systems and module sales during the year.

For the year ending December 31, 2011, the Semiconductor Materials segment's gross profit dollars were negatively impacted by lower sales volumes, unfavorable foreign currency effects, inventory charges related to supplies, ramp costs at our Ipoh, Malaysia facility, and the March 2011 earthquake in Japan, offset partially by improved pricing on wafers and lower costs for polysilicon. The Solar Energy segment's margins in 2011 were significantly impacted by the sharp decline in solar wafer pricing during the second half of the year, which was only partially offset by lower costs of solar wafers, increased solar wafer and energy sales volume, and $175.7 million in revenue recognized on the resolution of the Suntech contract. Additionally, inventory write-downs of $107.0 million were recorded during 2011 due primarily to the sharp decline in solar wafer pricing and the underutilization of our Kuching solar wafering plant as we ramped production and implemented new technologies. Gross profit was also unfavorably impacted by $37.4 million in charges recorded to cost of goods sold related to the estimated probable shortfall of our purchase obligations associated with certain take-or-pay agreements, and due to a larger number of projects under which revenue was deferred generally to the extent of our gross profit because of guarantees and indemnifications. See Note 17.

Marketing and Administration	2012			2011			2010
Dollars in millions
Marketing and Administration	$	306.2		$	352.8		$	267.0
As a Percentage of Net Sales	12.1		%	13.0		%	11.9		%

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The decrease in marketing and administration expenses from 2011 to 2012 is primarily the result of lower spending across all segments as part of our restructuring efforts with the 2011 Global Plan. We expect these benefits to continue into 2013 as the full extent of the benefits of our 2011 Global Plan is realized by the end of calendar 2013. During the year ended December 31, 2012, we recorded a $12.8 million charge to income to adjust the fair value of contingent consideration and during the year ended December 31, 2011 we recorded a favorable adjustment of $26.3 million to adjust the fair value of contingent consideration. Additionally, there were $8.6 million of net unfavorable legal verdicts and settlements recorded in 2011 and $11.3 million of incremental costs incurred as a consequence of the Japan earthquake that were expensed as incurred in 2011. No similar expenses were incurred in 2012.

The increase in marketing and administration expenses from 2010 to 2011 is primarily the result of an increase of Solar Energy segment costs of approximately $88 million related to the continued investment in staffing, infrastructure and other project development to drive system growth, including the construction and execution of sale-leaseback projects, which significantly increased over the prior year. The increase in sale-leasebacks had a negative impact on marketing and administration expenses as a percentage of sales given that revenue is not recorded upon the sale of solar energy systems under our sale-leasebacks. Also driving the increase was $8.6 million of net unfavorable legal verdicts and settlements recorded in 2011 and $11.3 million of incremental costs incurred as a consequence of the Japan earthquake that were expensed as incurred, which was only partially offset by the favorable fair value adjustments on certain acquisition contingent consideration of $26.3 million. The remaining increase was related to general overhead costs and professional services at Corporate and the Semiconductor Materials segment.

Research and Development	2012			2011			2010
Dollars in millions
Research and Development	$	71.8		$	87.5		$	55.6
As a Percentage of Net Sales	2.8		%	3.2		%	2.5		%

R&D expenses consist mainly of product and process development efforts to increase our capabilities in each of our business units. The decrease in R&D expenses in 2012 aligns with our restructuring efforts of the 2011 Global Plan. The increases in R&D expenses in 2011 were primarily due to technology developments to lower the cost of energy delivery at the solar energy systems level, primarily in the development of our solar materials business. Overall spend on R&D in 2013 is expected to decrease from 2012 amounts, particularly as it relates to solar wafering.

Goodwill Impairment Charges	2012			2011			2010
Dollars in millions
Goodwill Impairment Charges	$	—		$	440.5		$	—
As a Percentage of Net Sales	—		%	16.2		%	—		%

As previously discussed, the solar industry experienced a significant downturn in the second half of 2011, including sharp reductions in pricing of solar modules, solar cells, solar wafers, polysilicon, and to a lesser extent, solar systems, leading to a dramatic decline in profitability versus prior years. Additionally, because of these economic factors, our market capitalization deteriorated significantly. Our goodwill impairment tests performed during 2011 determined that the estimated fair value of our reporting units was below the estimated fair value of their net assets. As a result, goodwill impairment charges of $440.5 million were recorded to the Solar Energy segment during the year ended December 31, 2011. As of December 31, 2012, our recorded goodwill is zero.

Restructuring (Reversals) Charges	2012			2011			2010
Dollars in millions
Restructuring (Reversals) Charges	$	(83.5	)	$	350.7		$	5.3
As a Percentage of Net Sales	(3.3		)%	12.9		%	0.2		%

During the fourth quarter of 2011, in response to the current and expected difficult market conditions in the semiconductor and solar markets as well as to improve the company's overall cost competitiveness and increase cash flow generation across all segments, MEMC committed to a series of actions to be taken to reduce the company's global workforce, right size its production capacity and accelerate operating cost reductions in 2012 and beyond. Restructuring charges in 2011 consist of

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$62.1 million of severance and other one-time benefits for terminated employees under the 2011 Global Plan, $226.4 million of contract settlement, cancellation or termination payments and penalties, as well as $51.0 million of other one-time charges as a result of our committed actions. In addition, $11.2 million of additional restructuring charges were recorded during 2011 related to the 2009 U.S. Plan and other 2011 restructuring activities. See Note 3.

As part of our efforts under the 2011 Global Plan, in 2012 we executed settlement agreements with Evonik to settle disputes arising from our early termination of two take-or-pay supply agreements. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrual was made for 2012 resulting in $69.2 million of income within restructuring charges. In addition to this settlement, we had other revisions to our estimated restructuring expenses based on actual results differing from our previous estimates.

Gain on receipt of property, plant and equipment	2012			2011			2010
Dollars in millions
Gain on Receipt of Property, Plant and Equipment	$	(31.7	)	$	—		$	—
As a Percentage of Net Sales	(1.3		)%	—		%	—		%

As previously discussed, we obtained title to a chlorosilanes plant as part of the settlement with Evonik, which resulted in the recognition of $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012. No similar amounts were recorded during 2011 and 2010.

Long-lived Asset Impairment Charges	2012			2011			2010
Dollars in millions
Long-lived Asset Impairment Charges	$	19.6		$	367.9		$	—
As a Percentage of Net Sales	0.8		%	13.5		%	—		%

We recorded asset impairment charges of $19.6 million for the year ended December 31, 2012, primarily related to solar wafer assets. These charges are reflected in the long-lived asset impairment charges in our consolidated statement of operations.

During 2011, due to the significance of the market downturn, we performed an asset impairment analysis of the polysilicon production assets at our Merano, Italy facility, and the wafering assets at our Portland, Oregon, Kuching, Malaysia and St. Peters, Missouri facilities. We reduced the net carrying value of the Merano assets to an estimated salvage value. For our wafering assets, we estimated the fair value of the asset group using discounted expected cash flows and recorded an impairment charge for the amount of excess of fair value over the net carrying value of the asset group. We developed our expected cash flows based on assumptions that are consistent with our current forecast operating matrices. Cash flows cover a time period that coincides with the estimated remaining useful life of the primary assets, and a probability factor was assigned to the cash flow scenarios to derive the expected present value based on a risk-free discount rate.

Insurance Recovery	2012			2011			2010
Dollars in millions
Insurance Recovery	$	(4.0	)	$	(4.0	)	$	(11.9	)
As a Percentage of Net Sales	0.2		%	0.1		%	0.5		%

During 2012 and 2011, we recorded income of $4.0 million for an insurance claim to recover a portion of our losses related to the disruption in production at our Utsunomiya, Japan semiconductor manufacturing facility as a result of the March 2011 Japan earthquake.

During the second quarter of 2010, we received $11.9 million in net insurance proceeds from our business interruption lost profits claim related to the disruption in production at our Pasadena, Texas facility as a result of Hurricane Ike in 2008. Of this amount, $8.0 million was recorded to our Semiconductor Materials segment and $3.9 million was recorded to our Solar Materials segment based on the amount of polysilicon used in each of the segments.

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Operating Income (Loss)	2012			2011			2010
Dollars in millions
Semiconductor Materials	$	(5.0	)	$	(31.1	)	$	68.2
Solar Energy	162.2			(1,144.0		)	76.2
Corporate and Other	(100.0		)	(125.4		)	(123.3		)
Total Operating Income (Loss)	$	57.2		$	(1,300.5	)	$	21.1

Semiconductor Materials Segment

The increase in our Semiconductor Materials operating income from a loss of $31.1 million in 2011 to a loss of $5.0 million in 2012 is primarily due to $44.5 million of restructuring charges recorded during 2011, cost benefits realized in 2012 from the restructuring activities, productivity improvements in 2012 and the non-recurring expenses for the March 2011 earthquake in Japan. These benefits offset the reduction in gross margin attributable to the significant average wafer selling price decreases experienced in 2012.

The decrease in our Semiconductor Materials operating (loss) income from income of $68.2 million in 2010 to a loss of $31.1 million in 2011 is primarily due to $44.5 million of restructuring charges recorded during 2011, inventory write-downs, lower sales volumes, the impact of unfavorable foreign currency exchange, ramp costs at our Ipoh, Malaysia facility, and the March 2011 earthquake in Japan, offset only partially by improved average pricing on wafers and lower costs for polysilicon.

Solar Energy Segment

The increase in our Solar Energy operating income in 2012 over 2011 is largely attributable to $305.3 million of restructuring charges, $360.5 million of long-lived asset impairments and $440.5 million of goodwill impairments recorded during 2011, which did not occur in 2012. Also contributing to the operating loss for 2011 were inventory write-downs of $113.6 million, compared to $3.4 million in 2012 and declines in solar wafer sales in 2011. The 2011 charges were partially offset by $175.7 million of revenue recognized on the Suntech contract resolution in 2011, offset by the revenue recognized on the Conergy contract termination of $37.1 million recorded in 2012 and the increase in solar energy system sales. Additionally, in 2012 we executed settlement agreements with Evonik to settle disputes arising from our early termination of two take-or-pay supply agreements. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrual was made resulting in $69.2 million of income classified within restructuring charges. On December 30, 2012, also as part of the settlement with Evonik, we obtained title to a chlorosilanes plant which resulted in $31.7 million of income in the fourth quarter of 2012.

The decrease in our Solar Energy segment operating income from $76.2 million of operating income in 2010 to a $1,144.0 million loss in 2011 is largely attributable to the previously mentioned asset and goodwill impairments and restructuring charges of 2011. Also contributing to the operating loss for 2011 was the sharp decline in solar wafer pricing, inventory write-downs of $113.6 million, including unfavorable production variances at our Kuching, Malaysia solar wafering facility as it ramped during 2011, $37.4 million of estimated obligations for purchase shortfalls from our long-term take-or-pay raw material purchase agreements and higher operating costs related to the continued investment in staffing, infrastructure and other project development costs and fees, including the construction and execution of sale-leaseback projects, which significantly increased over 2010 to support growth in sales of solar energy systems. These were offset partially by $175.7 million of revenue recognized on the Suntech contract resolution, year-over-year increased sales volume and lower costs of solar wafers.

The Solar Energy segment's operating results are highly dependent upon the timing of system sales and revenue recognition requirements related to the terms of sales agreements and type of project finance method utilized, as well as completed and
uncompleted projects. Revenue and income recognition in any given period may differ due to the timing of installation, related expenditures, system warranty and indemnity provisions and the type of financing obtained.

For the years ending December 31, 2012 and 2011, we did not recognize approximately $40.4 million and $78.5 million, respectively, of expected gross margins on in process or completed projects with executed sales agreements which we expect to be recognized at a later date. We also received cash proceeds of $294.5 million and $511.9 million in 2012 and 2011, respectively, for our executed financing sale-leasebacks, which are collateralized by the system assets with a historical cost basis of $221.0 million and $338.0 million in 2012 and 2011, respectively. At the end of the lease, we expect to recognize a net gain from the extinguishment of the financing leaseback debt partially offset by the write-off of the remaining net book value of the system asset.

For the years ending December 31, 2011 and 2010, we did not recognize approximately $78.5 million and $62.9 million, respectively, of expected gross margins on in process or completed projects with executed sales agreements which we expect to

9

be recognized at a later date. We also received cash proceeds of $511.9 million and $160.8 million in 2011 and 2010, respectively, for our executed financing sale-leasebacks, which are collateralized by the system assets with a historical cost basis of $338.0 million and $119.4 million in 2011 and 2010, respectively. At the end of the lease, we expect to recognize a net gain from the extinguishment of the financing leaseback debt partially offset by the write-off of the remaining net book value of the system asset.

Corporate and Other

Corporate and other expenses are mainly comprised of substantially all of our stock-based compensation expense, general corporate marketing and administration costs, research and development administration costs, legal and tax professional services and related costs, salary and other personnel costs, and other items not reflected in the segments. As a percentage of consolidated net sales, Corporate and other expenses were 4.0%, 4.6% and 5.5% for 2012, 2011 and 2010, respectively.

Corporate and other expenses decreased during 2012 due to lower overhead costs as a result of our 2011 Global Plan actions and lower stock-based compensation expense.

Corporate and other expenses increased slightly during 2011 primarily due to $8.6 million of net legal proceeding verdicts and settlements during 2011, offset partially by lower professional fees and stock-based compensation expense. The legal expenses recorded to Corporate related to activities and business decisions of the corporate operations.

Non-operating Expense (Income)	2012			2011			2010
Dollars in millions
Interest Expense	$	135.3		$	77.2		$	29.0
Interest Income	(3.6		)	(4.5		)	(5.5		)
Decline in Fair Value of Warrant	0.2			4.8			14.0
Other, net	6.8			6.1			(3.9		)
Total Non-operating Expense	$	138.7		$	83.6		$	33.6

In 2012, we recorded $135.3 million of interest expense, net of capitalized interest of $19.9 million. Of the $135.3 million interest expense, $78.1 million relates to our debt and capital leases for solar energy systems. The interest expense related to solar energy systems includes $7.4 million of deferred financing fees that were charged to interest expense when previously issued solar energy system debt was transferred to the buyer upon sale of the system. Additionally, $3.9 million of deferred financing fees were charged to interest expense as a result of amendments made to our non-recourse project construction financing revolver. There were no similar charges in interest expense for 2011. The remaining interest expense relates to interest on our 2019 Notes and our new Term Loan, which was issued in September of 2012, of $42.6 million and $5.4 million, respectively. The increase in interest expense over the prior year is primarily the result of increases in our non-recourse solar energy system financing.

In 2011, we recorded $77.2 million of interest expense, net of capitalized interest of $18.1 million. $34.4 million of that interest expense related to our 2019 Notes, as discussed in "Liquidity and Capital Resources" below. The remaining interest expense related primarily to debt and capital leases for solar energy systems. In 2011, we recorded interest expense of $32.2 million to the Solar Energy segment, net of capitalized interest of $11.9 million. The increase in interest expense over the prior year was also the result of an overall higher interest rate related to the 2019 Notes, which bear interest at 7.75%, and is higher than the rates on our revolving credit facilities and solar system debt.

The decrease in fair value of warrant represents the mark-to-market adjustment for a warrant received from a customer, Suntech Power Holdings (“Suntech”), which estimated fair value is primarily related to the Suntech stock price.

The changes in Other, net from $3.9 million of income in 2010 to $6.1 million of expense in 2011 is due primarily to an $11.6 million impairment during the fourth quarter of 2011 of an investment accounted for under the cost method.

Income Taxes	2012			2011			2010
Dollars in millions
Income Tax Expense (Benefit)	$	64.9		$	73.1		$	(53.3	)
Income Tax Rate as a % of (Loss) Income Before Income Taxes	(79.6		)%	(5.3		)%	426.4		%

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In the year ended December 31, 2012, we recorded an income tax expense of $64.9 million and an effective tax rate of negative 79.6%, compared to an income tax expense of $73.1 million and an effective tax rate of negative 5.3% for the year ended December 31, 2011. The 2012 net expense is primarily the result of a release of valuation allowances in certain foreign jurisdictions offset against the tax effect of the worldwide operational earnings mix at various rates, an increase to the accrued liability for uncertain tax positions and impacts due to the IRS exam, discussed below. The 2011 net expense is primarily the result of charges taken to value certain deferred tax assets. The lower effective rate in 2011 was caused by the charges taken for restructuring, goodwill impairments and asset impairments that were mostly not deductible for tax purposes. The domestic impact is the combination of charges taken related to certain deferred tax assets and the impact, including foreign tax credits, of the deemed repatriation of the earnings of certain foreign subsidiaries. The foreign impact is a net tax expense lower than the U.S. federal income tax expense due to lower statutory tax rates, available tax incentives, and reserves for uncertain tax positions

Certain of our Asian subsidiaries have been granted a concessionary tax rate of between 0% and 5% on all qualifying income for a period of up to five to ten years based on investments in certain machinery and equipment and other development and expansion activities, resulting in a tax benefits for 2012, 2011 and 2010 of approximately $4.6 million, $15.7 million and $15.0 million, respectively. Under the awards, the income tax rate for qualifying income will be an incentive tax rate lower than the corporate tax rate. MEMC was in compliance with the qualifying conditions of these tax incentives. As of December 31, 2012, the last of these incentives will expire between 2013 and 2022.

During the quarter ended June 30, 2010, we concluded the IRS examination for the 2006 and 2007 tax years and, as a result, we recorded favorable and unfavorable adjustments to our accrual for uncertain tax positions. We received proposed taxable income adjustments from the IRS related to various cost allocations and taxable income adjustments attributable to our foreign operations. The settlement of those positions resulted in an increase to the accrual of $29.9 million. The resolution of these matters resulted in an assessment of $31.6 million, which included penalties and interest of $5.0 million, net of $2.3 million of federal benefit. Additionally, MEMC had uncertain tax positions for deductions and tax credits that were effectively settled during the exam which reduced the accrual by $51.0 million. The net effect to our tax provision for the closure of the exam was a $15.5 million tax benefit.

We are currently under examination by the IRS for the 2008, 2009 and 2010 tax years. Additionally, due to the carry back of our 2009 net operating loss for utilization against the 2007 tax liability, the IRS has re-opened the 2007 tax year for further review. We believe it is reasonably possible that some portions of the examination could be completed within the next twelve months; however, the results of the examination and any potential settlement are not reasonably estimable at this time.

We believe our tax positions are in compliance with applicable tax laws and regulations. We routinely review our estimate for our uncertain tax positions and during the year ended December 31, 2012, we increased the accrued liability by $4.7 million related to taxable income adjustments attributable to our foreign operations. There is risk, however, that the amounts ultimately settled upon resolution of an audit could be materially different from the amounts previously included in our tax liabilities and, therefore, could have a material impact on our tax provision, net income, tax liabilities and cash flows.

Equity in (Losses) Earnings of Joint Venture, Net of Tax	2012			2011			2010
Dollars in millions
Equity in (Losses) Earnings of Joint Venture, Net of Tax	$	(2.3	)	$	(62.8	)	7.2

Equity in (losses) earnings of joint venture, net of tax, for the year ending December 31, 2012 relates primarily to the losses recorded during the year by both our SMP and Zhenjiang Huantai joint ventures.

Equity in (losses) earnings of joint venture, net of tax, for the year ending December 31, 2011 includes $67.3 million of other than temporary impairment charges for our investments in two joint ventures, Zhenjiang Huantai Science and Technology Co. Ltd. (formerly Jiangsu Huantai Group Co. Ltd) and JA MEMC (Yangzhou) Solar Technology Compay Ltd. The impairments were a result of then current market conditions and our actions related to the 2011 Global Plan to reduce wafering capacity. The impairment charges recorded during 2011 were partially offset by earnings from our Zhenjiang Huantai joint venture.

FINANCIAL CONDITION

Cash and cash equivalents decreased $13.2 million from $585.8 million at December 31, 2011 to $572.6 million at December 31, 2012. See additional discussion in "Liquidity and Capital Resources" below.

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Our short-term restricted cash totaled $72.4 million at December 31, 2012 compared to $125.2 million at December 31, 2011. The decrease was primarily due to the release of restrictions during 2012 on the use of proceeds from a construction loan, offset by the result of the initial deposits received into restricted cash for termouts of our sale-leaseback projects and deposits for normal energy revenues.

Inventories decreased $74.0 million from $321.8 million at December 31, 2011 to $247.8 million at December 31, 2012. The decrease related to inventories across both segments and was caused by our efforts during 2012 to reduce excess inventories that existed at the end of 2011 and general process improvements on inventory management.

Solar energy systems held for development and sale, including consolidated variable interest entities (“VIEs”), decreased $239.2 million to $133.8 million at December 31, 2012 from $373.0 million at December 31, 2011. The decrease relates primarily to $179.5 million of European solar energy systems sold during 2012, which were classified as held for sale as of December 31, 2011.

Our net property, plant and equipment, including our consolidated VIEs, increased $279.9 million to $2,673.0 million at December 31, 2012 from $2,393.1 million at December 31, 2011. The increase was primarily due to capital expenditures of $139.0 million, mostly in our Semiconductor Materials segment, and the increase in solar energy systems under construction of $346.9 million that we expect will be primarily financed by financing sale-leasebacks and to a lesser extent, held systems which will remain as property, plant and equipment and will generate electricity revenues in the future. These increases were partially offset by depreciation expense of $200.6 million.

Our net deferred tax assets totaled $84.9 million at December 31, 2012 compared to $107.9 million at December 31, 2011. The decrease of $23.0 million in net deferred tax assets is primarily attributable to a net increased valuation allowance of $94.8 million, partially offset by additional deferred tax assets associated with future disallowances of deferred book revenue for solar energy systems.

Long-term debt, short-term debt and capital leases, including the current portion and our consolidated VIEs, increased to $2,368.3 million at December 31, 2012 from $1,926.8 million at December 31, 2011. This increase of $441.5 million was partially related to the issuance of $196.0 million for the Term Loan. The remaining increase was related to solar energy system financing due to our financing leaseback transactions that occurred in 2012 in which the sale proceeds are treated as non-recourse debt, partially offset by repayments of our non-recourse construction revolver.

Accounts payable of $477.0 million at December 31, 2012 decreased $217.6 million from $694.6 million at December 31, 2011. The decrease relates to the timing of payments to vendors, primarily for the costs of certain solar energy systems held for sale as of December 31, 2011.

Long-term customer deposits decreased $92.3 million from $276.8 million as of December 31, 2011 to $184.5 million as of December 31, 2012. The decrease is due to $37.7 million of net cash payments made under the supply and license agreement with the SMP JV and $34.0 million of deposits utilized for purchases during the year. The remaining decrease was caused by the deposits forfeited by Conergy as part of the contract termination as discussed in Note 17.

Other long-term liabilities decreased $117.2 million to $208.9 million at December 31, 2012, from $326.1 million at December 31, 2011. The decrease is primarily due to the settlements of various supplier contracts related to the 2011 Global Plan. See Note 3.

LIQUIDITY AND CAPITAL RESOURCES

We incurred a net loss attributable to MEMC stockholders of $150.6 million for the fiscal year ended December 31, 2012 and used $263.5 million of cash for operations. In addition to taking the actions set forth in the 2011 Global Plan as discussed more fully in Note 3, we had developed a strategic plan for the ongoing operation of our businesses designed to improve our performance and address the challenges within our industries. Successful implementation of our 2011 Global Plan and our strategic plan is, however, subject to numerous risks and uncertainties. In addition, solar industry conditions have negatively impacted our results from operations and cash flows, and may continue to do so in the future. If we delay the construction of solar energy systems or are unable to sell solar energy systems, our operating results and cash flows will be adversely impacted.

Our consolidated financial statements have been prepared assuming the realization of assets and the satisfaction of liabilities in the normal course, as well as continued compliance with the financial and other covenants contained in our existing credit facilities and other financing arrangements.

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Liquidity

Cash and cash equivalents at December 31, 2012 totaled $572.6 million, compared to $585.8 million at December 31, 2011. Approximately $438.5 million of these cash and cash equivalents was held by our foreign subsidiaries, a portion of which may be subject to repatriation tax effects. We believe that any repatriation tax effects would have minimal impacts on future cash flows. The tax effects could be minimized by our actions, including, but not limited to, our ability to bring cash and cash equivalents to the U.S. through settlement of certain intercompany loans.

The primary items impacting our liquidity in the future are cash from operations and working capital, capital expenditures, borrowings and payments under our credit facilities and other financing arrangements and the availability of project finance and/or project equity at acceptable terms. We believe our liquidity will be sufficient to support our operations for the foreseeable future, although no assurances can be made if significant adverse events beyond our control occur, or if we are unable to access project capital needed to execute our business plan.

We are focused on effective cash management. In addition to our need to have sufficient cash reserves, cash flow from our operations, and borrowing capacity under our credit facilities, we will need to raise additional funds in the future in order to meet the operating and capital needs of our solar energy systems development business. These funds are expected to be in the form of project finance or outright sale of solar energy systems to investors. However, there can be no assurances that such project financing or equity will be available to us at all, or available to us on terms and conditions we find acceptable. We may not be able to sell solar projects or secure adequate debt financing or equity funding on favorable terms, or at all, at the time when we need such funding. If these or other sources of funding are not available, this will have a significant negative impact on our ability to execute our business plan and to our overall operations, operational results and cash flows.

In the event that we are unable to raise additional funds, our liquidity will be adversely impacted, we may not be able to maintain compliance with our existing debt covenants and our business will suffer. If we are able to secure additional financing, these funds could be costly to secure and maintain and could significantly impact our earnings and our liquidity.

We have discretion in how we use our cash to fund capital expenditures, to develop solar energy systems, and for other costs of our business. We evaluate capital projects and the development of solar energy systems based on their expected strategic impacts and our expected return on investment. We may use this discretion to decrease our capital expenditures and development of solar energy systems, which may impact our operating results and cash flows for future years. For example, we may defer construction of solar energy systems and look for opportunities to partner with outside investors to finance the development of projects.

Net cash provided (used) by activity during the years ended December 31, 2012, 2011 and 2010 follows:

	2012			2011			2010
Dollars in millions
Net Cash Provided by (Used in):
Operating Activities	$	(263.5	)	$	(15.3	)	$	347.6
Investing Activities	(512.5		)	(1,262.9		)	(521.8		)
Financing Activities	764.8			1,150.7			243.2

In 2012, $263.5 million of cash was used for operating activities, compared to $15.3 million that was used in operating activities in 2011. The decrease in operating cash flows was primarily a result of the decrease in our accounts payable and accrued liabilities for payments made to vendors for certain solar energy systems and payments in 2012 for restructuring activities.

In 2011, $15.3 million of cash was used for operating activities, compared to $347.6 million that was generated from operating activities in 2010. The decrease was primarily a result of the operating loss for 2011, and increases in inventories and solar energy systems held for development and sale, offset only partially by cash inflows from deferred revenue on solar energy systems and customer deposits.

Our principal sources and uses of cash during 2012 were as follows:

Sources:

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• Received $50.8 million from noncontrolling interests for investments in solar energy systems;

• Received $185.2 million from the September 2012 Term Loan, net of issuance fees;

• Received $904.2 million, primarily from the sale-leaseback of solar energy systems; and

Uses:

• Used $263.5 million for operations;

• Invested $139.0 million in capital expenditures, primarily in our Semiconductor Materials segment;

• Invested $346.9 million in construction of Solar energy systems that will remain on our balance sheet; and

• Repaid $246.2 million related to leases of solar energy systems.

At December 31, 2012, we had approximately $21.3 million of committed capital expenditures in our Semiconductor Materials segment and Corporate and other. Capital expenditures in 2012 primarily related to increasing our semiconductor capacity and expanding capability for our next generation products.

At December 31, 2012, we had approximately $346.2 million of committed capital expenditures for our Solar Energy segment primarily related to projects intended for sale-leaseback.

MEMC will require access to additional capital to fund projected growth of our solar energy system operations. During the construction phase of solar energy systems, MEMC provides short-term working capital support to a project company or may obtain third party non-recourse construction financing to fund engineering, procurement and installation costs. Once complete, MEMC either directly sells the project to a third party or obtains more permanent capital on behalf of the project company through sale-leaseback, or to a lesser extent, debt or other financing structures that will typically be secured by the energy producing assets and projected cash flows from energy sales.

Our solar energy systems for which we have capital lease and finance obligations are included in separate legal entities. The capital lease and finance obligations have recourse to those entities but in most cases, no recourse to the MEMC parent or SunEdison legal entities.

The total capital necessary will be driven primarily by the amount of megawatts of energy producing assets installed and interconnected. Our development and construction of solar energy systems are funded primarily through operating cash flows, non-recourse project finance, and our corporate revolving credit facility. MEMC expects 2012 year end cash on hand, 2013 operating cash flows, project finance debt, the corporate revolving credit facility and non-recourse project finance construction revolver to provide sufficient capital to support the construction phase of its currently planned projects for 2013 and otherwise meet its capital needs for 2013. However, we will continue to need to raise additional funds in the form of long-term project financing, either in the form of project debt or equity, or both. MEMC expects ongoing efforts to secure more capital, including sources of non-recourse project capital, to generate sufficient resources to support growth. The rate of growth of the Solar Energy segment is limited by capital access. At year end 2012, our liabilities associated with project finance capital totaled $1,606.2 million. We anticipate incremental 2013 capital needs associated with project finance markets to range from $800 million to $1,500 million depending on the amount of megawatts ultimately installed and interconnected in 2013. However, there can be no assurances that such financing will be available to us or at terms that we find acceptable.

In 2012, cash provided by financing activities was $764.8 million, compared to $1,150.7 million cash provided by financing activities in 2011. The change was mainly due to higher net proceeds in 2011 from the issuance of the 2019 Notes, compared to the lower net proceeds of the 2012 Term Loan, both discussed below. Additionally, the change relates to the decline in net solar energy system financings to $658.0 million in 2012 compared to $804.7 million in 2011. The decreases are partially offset by an increase in the net proceeds from noncontrolling interests.

Revolving Credit Facility

Our corporate revolving credit facility with Bank of America, N.A. is an aggregate principal amount of $400.0 million (the “Credit Facility”).

The Credit Facility has a term of three years and expires in March of 2014. Our obligations under the facility are guaranteed by certain domestic subsidiaries of MEMC. Our obligations and the guaranty obligations of the subsidiaries are secured by liens on and security interests in substantially all present and future assets of MEMC and the subsidiary guarantors, including a pledge of the capital stock of certain domestic and foreign subsidiaries of MEMC.

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Interest under the Credit Facility will accrue, depending on the type of borrowing, at the base rate (in the case of base rate loans and swing line loans) or the eurocurrency rate (in the case of eurocurrency rate loans), plus, in each case, an applicable rate that varies from (currently 3.75%) for the eurocurrency rate to (currently 2.75%) for the base rate, depending on our consolidated leverage ratio. Interest is due and payable in arrears at the end of each interest period (no less than quarterly) and on the maturity date of the Credit Facility. Principal is due on the maturity date. Commitment fees of 0.50% are payable quarterly on the unused portion of the aggregate commitment of $400 million. Letter of credit fees are payable quarterly on the daily amount available to be drawn under a letter of credit at an applicable rate that varies (currently 2.75%), depending on our consolidated leverage ratio.

On February 28, 2012, we amended our Credit Facility to reduce our expected minimum liquidity covenant of $500 million to $450 million and $350 million for the first and second quarters of 2012, respectively.

On May 8, 2012, we further amended our Credit Facility to allow for a consolidated leverage ratio of not greater than 3.0 to 1.0 for the second and third quarters of 2012 and to set our minimum liquidity covenant at $400 million for the third quarter of2012. In the fourth quarter of 2012, our consolidated leverage ratio covenant reverted back to 2.5 to 1.0, and our minimum liquidity covenant under this facility will require a minimum liquidity amount based on our trailing twelve month consolidated EBITDA. Our minimum liquidity covenant amount will be $500 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $400 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $300 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. The interest rates on borrowings under the Credit Facility were also amended to the eurocurrency rate plus 3.75% and the base rate plus 2.75%, as applicable. The Credit Facility was also amended to permit us to incur up to $250 million of convertible or subordinated unsecured indebtedness, subject to compliance with certain conditions.

In order to accommodate the Term Loan, the Credit Facility was further amended on September 28, 2012. We incurred $2.0 million in debt issuance costs, which is amortized into the consolidated statement of operations and comprehensive (loss) income over the remaining term of the Credit Facility. There were no changes to the maximum capacity or stated interest rate as part of the amendment, although the Credit Facility lenders and Term Loan lenders entered into a customary intercreditor agreement.

The Credit Facility contains representations, covenants and events of default typical for credit arrangements of comparable size, including a variable minimum liquidity amount ($500.0 million at December 31, 2012) and a consolidated leverage ratio of less than 2.50 to 1.00. The company's compliance with these covenants is measured at the end of each calender quarter.  The Credit Facility also contains a customary material adverse effects clause and a cross default clause. The cross default clause is applicable to defaults on other indebtedness in excess of $35.0 million, excluding our non-recourse indebtedness. The excess of the revolver commitment over the current level of outstanding letters of credit and cash borrowings represents the additional borrowing availability under the Credit Facility. Our liquidity position was in excess of the minimum liquidity amount by $350.7 million and our consolidated leverage ratio was 1.8 at December 31, 2012. As of December 31, 2012, we were in compliance with all covenants. We anticipate compliance with all covenants for at least the next twelve months. However, the ability to comply with these provisions may be affected by events beyond our control.

During 2012 and 2011 we had no borrowings outstanding under this facility, although we had approximately $121.8 million and $173.0 million, respectively, of outstanding third party letters of credit backed by this facility at each year end, which reduces the available capacity.  Therefore, funds available under this facility were $278.2 million and $227.0 million as of December 31, 2012 and December 31, 2011, respectively.

Second Lien Term Loan Credit Agreement

During the third quarter of 2012, we entered into a Second Lien Credit Agreement ("Term Loan") with Goldman Sachs Bank USA and Deutsche Bank Securities Inc. providing for a term loan maturing on October 2, 2017, in an aggregate principal amount of $200.0 million, with a 2.0% discount to par for proceeds of $196.0 million. Additionally, we incurred $10.8 million in debt issuance costs, which is amortized into the consolidated statement of operations and comprehensive (loss) income over the five year term. Interest under the Term Loan will accrue, depending on the type of borrowing, at the base rate or the eurocurrency rate, with a floor of 1.50%, plus an applicable rate equal to 9.25% for the eurocurrency rate and 8.25% for the base rate. Interest is due and payable in arrears at the end of each interest period, no less than quarterly, and on the maturity date. As of December 31, 2012 the current interest rate on the Term Loan is 10.75%. On January 15, 2013, we entered into an interest rate cap with a notional amount of $200.0 million, a cap rate of 1.50%, an effective date of March 28, 2013 and a maturity date of September 30, 2015. The interest rate cap will hedge the 3-month LIBOR variable rate maintained within the term loan, described in Note 11. Under the agreement, we pay the fixed rate and the financial institution counterparty to the

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agreement pays MEMC a floating interest rate. The interest rate cap will be accounted for as hedge accounting under a cash flow hedge designation. The changes in fair value will be recorded through other comprehensive income (loss) on the consolidated balance sheets, with any ineffectiveness recorded in the statement of operations.

The obligations under the Term Loan are guaranteed by certain of our domestic subsidiaries pursuant to a guaranty agreement executed by each such subsidiary. Our obligations and the guaranty obligations of the subsidiaries are secured by second priority liens on and security interests in substantially all of our present and future assets and the assets of the subsidiary guarantors, including a pledge of the capital stock of domestic and foreign subsidiaries.

We may elect to prepay amounts due under the Term Loan with prior notice to the administrative agent. Any voluntary prepayments made on or prior to March 31, 2014 are subject to yield maintenance payments to the lenders in an amount not less than 3.0% of the principal amount then being prepaid. Voluntary prepayments made after March 31, 2014 but on or prior to March 31, 2015 are subject to a call premium of 3.0% of the principal amount then being prepaid. The call premium reduces to1.0% for prepayments made after March 31, 2015 but on or prior to March 31, 2016. The company may make prepayments after March 31, 2016 without premium or penalty.

Similar to the revolving credit facility with Bank of America, N.A. (discussed below), the Term Loan contains affirmative and negative covenants. These include but are not limited to limiting the company's and certain of our subsidiaries' ability, subject to certain exceptions and qualifications, (i) to create, incur, assume or suffer any liens on assets or revenues, (ii) to make other restricted payments and investments, (iii) to incur indebtedness, (iv) to make certain transactions with affiliates, (v) to merge, consolidate or sell/dispose of assets, (vi) to enter into burdensome agreements, (vii) to engage in any material line of business different from current lines, or (viii) to prepay indebtedness or amend indebtedness that adversely affects the Term Loan lenders. These covenants are subject to a number of qualifications and limitations.

Additionally, the Term Loan has financial covenants requiring a consolidated leverage ratio of 3.0 to 1.0, and minimum liquidity levels depending on our trailing twelve-month consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA). Our minimum liquidity covenant amount will be $400 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $300 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $200 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. As of December 31, 2012 we were in compliance with all covenants of the Term Loan.

Senior Notes

On March 10, 2011, we issued $550.0 million of 7.75 % Senior Notes due April 1, 2019 (the "2019 Notes"). We incurred $13.8 million in debt issuance costs, which is amortized into the statement of operations over the eight year term. The 2019 Notes were sold at a price equal to 100% of the principal amount thereof. The interest on the 2019 Notes is payable semi-annually, in cash in arrears, on April 1 and October 1, and commenced on October 1, 2011. We may redeem the 2019 Notes at our option, in whole or in part, at any time on or after April 1, 2014, upon not less than 30 nor more than 60 days notice at the redemption prices (expressed as percentages of the principal amount to be redeemed) set forth below, plus any accrued and unpaid interest and additional interest, if any, to the redemption date, if redeemed during the 12-month period beginning on April 1 of the years indicated below.

Year	Price
2014	105.813	%
2015	103.875	%
2016	101.938	%
2017 and thereafter	100.000	%

If a change of control of MEMC occurs, each holder of the 2019 Notes will have the right to require us to repurchase all or any part of that holder's notes at a purchase price of 101% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, to the date of the repurchase.

The 2019 Notes are guaranteed by certain of MEMC's domestic subsidiaries (the “guarantors”). The 2019 Notes are senior unsecured obligations and are subordinated to all of our and the guarantors' existing and future secured debt.

The indenture governing the 2019 Notes contains covenants that limit our and certain subsidiaries' ability, subject to certain exceptions and qualifications, (i) to make certain asset sales, (ii) to make certain restricted payments and investments, (iii) to

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incur indebtedness and issue preferred stock, (iv) to declare dividends, (v) to make other payments affecting restricted subsidiaries, (vi) to engage in certain transactions with affiliates, and (vii) to merge, consolidate or sell substantially all of our assets. These covenants are subject to a number of qualifications and limitations, and in certain situations, a cross default provision. As of December 31, 2012, we were in compliance with all covenants contained within the indenture governing the 2019 Notes.

In addition, the indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among other things: failure to make payments on the 2019 Notes when due, failure to comply with covenants under the indenture, failure to pay other indebtedness or acceleration of maturity of other indebtedness, failure to satisfy or discharge final judgments and occurrence of bankruptcy events.

Short–term Debt

On September 30, 2011, SunEdison amended and restated its non-recourse project construction financing revolver, which has a term of three years, from $50.0 million to $300.0 million. This revolver was also further amended on February 28, 2012. Interest on borrowings under the agreement will be based on our election at LIBOR plus an applicable margin (currently 3.50%) or at a defined prime rate plus an applicable margin (currently 2.50%). The construction financing revolver also requires SunEdison to pay various fees, including a commitment fee (currently 1.10%). The construction financing revolver will be used to support the construction costs of utility and rooftop solar energy systems throughout the U.S. and Canada. The construction loans are non-recourse debt to entities outside of the project company legal entities that subscribe to the debt and is secured by a pledge of the collateral, including the project contracts and equipment. This revolver also includes a customary material adverse effects clause whereby a breach may disallow a future draw but not acceleration of payment. This revolver also maintains a cross default clause whose remedy, among other rights, includes the right to restrict future loans as well as the right to accelerate principal and interest payments. Because this is non-recourse financing, covenants relate specifically to the collateral amounts and transfer of right restrictions.

During 2012, due to various amendments and lenders entering and exiting the facility, the non-recourse construction financing revolver capacity was lowered from $300.0 million to $150.0 million. Under the terms of the amendments, if our Corporate Family or Corporate Credit Rating for Moody's Investors Service ("Moody's") falls below "B1" or our Standard and Poor ("S&P") rating falls below "B+", we will be required to post, at our election, a letter of credit or surety bond equal to 15.0% of the total outstanding balance in order to continue to make additional borrowings under this facility. As of December 31, 2012, our ratings were "B3" and "BB" for Moody's and S&P respectively. Because our Corporate Family Rating for Moody's was below "B1", a letter of credit equal to 15.0% of the $7.4 million outstanding balances was posted as of December 31, 2012. Additionally, $3.9 million of deferred financing fees were charged to interest expense during the second quarter of 2012, a result of the amendments made to our non-recourse project construction financing revolver. No similar charges were incurred in the comparable period of 2011 or 2010.

As of December 31, 2012 and December 31, 2011, there was $7.4 million and $77.2 million, respectively, outstanding on this construction revolver.

In the event additional construction debt is needed and the remainder of the original capacity is not renewed or replaced, we have the ability to draw upon the available capacity of our Credit Facility (discussed above). In the event we cannot renew, replace or backfill the remainder of the original capacity of the non-recourse construction revolver with other financing or have adequate net working capital, such inability to fund future projects may have an adverse impact on our business growth plans, financial position and results of operations.

At December 31, 2012, we had $572.6 million of cash and cash equivalents, $2,368.3 million of debt outstanding, of which the majority is long-term and non-recourse, and availability to borrow up to an additional $278 million under our revolving Credit Facility, subject to certain provisions and compliance with covenant requirements, including those described above and in Note 11. The breach of any of these provisions or covenants could result in a default under the Credit Facility and could trigger acceleration of repayment, and a cross default on our 2019 Notes and Term Loan, which could have a significant adverse impact on our liquidity and our business. While we expect to comply with the provisions and covenants of the Credit Facility agreement, Term Loan and the Indenture for the 2019 Notes through 2013, deterioration in the worldwide economy and our operational results could cause us to not be in compliance. While we would attempt to obtain waivers for noncompliance, we may not be able to obtain waivers, which could have a significant adverse impact to our liquidity and our business. Of our total debt outstanding, $1,562.9 million relates to project specific non-recourse financing that is backed by solar energy system operating assets.

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Our weighted-average cost of borrowing was 7.9% at December 31, 2012 and 6.6% at December 31, 2011, respectively. Our short-term borrowings are subject to renewal annually with each financial institution through the course of the year.

Our contractual obligations as of December 31, 2012 were as follows:

	Payments Due By Period
Contractual Obligations	Total		Less than 1 Year		1-3 Years		4-5 Years		After 5 Years
Dollars in millions
Capital Leases	$	93.3	$	7.5	$	7.3	$	7.0	$	71.5
Long-term Debt 1	1,931.9		125.1		154.3		341.5		1,311.0
Operating Leases	96.3		25.3		42.0		20.6		8.4
Purchase Obligations 2	819.9		474.6		137.6		120.5		87.2
Employee Related Liabilities 3	94.8		—		—		—		—
Other Long-term Liabilities—Uncertain Tax Positions 4	53.2		53.2		—		—		—
Customer Deposits 5	261.7		77.2		184.5		—		—
Contingent Consideration Liability 6	24.9		23.1		1.8		—		—
Total Contractual Obligations	$	3,376.0	$	786.0	$	527.5	$	489.6	$	1,478.1

____________________   

The contractual commitments shown above, except for our debt obligations, capital leases, employee related liabilities, uncertain tax positions and customer deposits, are not recorded on our consolidated balance sheet.

1 Long-term debt includes primarily minimum lease payments on our non-recourse financing leaseback transaction and repayment of our 2019 Notes and Term Loan.

2 Represents obligations for agreements to purchase goods or services that are enforceable and legally binding on the company, including minimum quantities at fixed prices to be purchased, committed capital expenditures, and outstanding purchases for goods or services as of December 31, 2012. These obligations include purchases related to solar energy systems under development and held for sale. In addition to the above purchase obligations, in connection with the 2011 Global Plan, we will no longer take supplies or materials for a number of purchase agreements. We have notified our vendors of our intent not to procure these materials and we have accrued $134.5 million related to these contracts, which includes the remaining payable for the Evonik settlement. These agreements either do not have stated fixed quantities and prices, have termination provisions, or require the vendor to mitigate losses by selling the materials to other parties. The actual amounts ultimately settled with these vendors could vary significantly, which could have a material adverse impact on our future earnings and cash flows.

3 Employee related liabilities include pension, health and welfare benefits and other post-employment benefits. Other than pensions, the employee related liabilities are paid as incurred and accordingly, specific future years’ payments are not reasonably estimable. Funding projections beyond the next twelve months as of December 31, 2012 are not practical to estimate due to the rules affecting tax-deductible contributions and the impact from the plan asset performance, interest rates and potential U.S. and international legislation.

4 As of December 31, 2012, $53.2 million of unrecognized tax benefits were included as a component of other long-term liabilities. Due to the inherent uncertainty of the underlying tax positions, we are unable to reasonably estimate in which future periods these unrecognized tax benefits will be settled.

5 Customer deposits consist of amounts provided in connection with long-term supply agreements which must be returned to the customers according to the terms of the agreements.

6 Represents the estimated fair value of contingent consideration payable remaining related to past acquisitions. See Note 19.

We have agreed to indemnify some of our semiconductor and solar wafer customers against claims of infringement of the intellectual property rights of others in our sales contracts with these customers. The terms of most of these indemnification

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obligations generally do not provide for a limitation of our liability. We have not had any claims related to these indemnification obligations as of December 31, 2012.

SunEdison generally warrants the operations of its solar energy systems. Due to the absence of historical material warranty claims and expected future claims, we have not recorded a warranty accrual related to solar energy systems as of December 31, 2012.

In connection with several contracts to sell outright solar energy systems, SunEdison has guaranteed the systems’ performance for two years following the date of interconnection. Also, under separate operations and maintenance services agreements, SunEdison guaranteed the uptime availability of the system over the term of the arrangement, which may last 20 years. To the extent there are shortfalls associated with either of the guarantees, SunEdison is required to indemnify the purchaser up to the guaranteed amount through a cash payment. The maximum losses that SunEdison may be subject to for non-performance are contractually limited by the terms of each executed agreement.

Our pension expense and pension liability are actuarially determined. See “Critical Accounting Policies and Estimates.” Effective January 2, 2002, we amended our defined benefit plan to discontinue future benefit accruals for certain participants. In addition, effective January 2, 2002, no new participants will be added to the plan. Effective January 1, 2012, we amended the defined benefit pension plan to freeze the accumulation of new benefits for all participants. This change did not have a material impact on the consolidated financial statements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions in certain circumstances that affect amounts reported in our consolidated financial statements and related footnotes. In preparing these financial statements, we have made our best estimates of certain amounts included in the financial statements. Application of accounting policies and estimates, however, involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. In arriving at our critical accounting estimates, factors we consider include how accurate the estimate or assumptions have been in the past, how much the estimate or assumptions have changed and how reasonably likely such change may have a material impact. Our significant accounting policies are more fully described in Note 2 of Notes to Consolidated Financial Statements herein.

Revenue Recognition

Wafer and Other Product Sales

Revenue is recognized for wafer and other product sales when title transfers, the risks and rewards of ownership have been transferred to the customer, the fee is fixed or determinable and collection of the related receivable is reasonably assured, which is generally at the time of shipment for non-consignment orders. In the case of consignment orders, title passes when the customer pulls the product from the assigned storage facility or storage area or, if the customer does not pull the product within a contractually stated period of time (generally 60–90 days), at the end of that period, or when the customer otherwise agrees to take title to the product. Our wafers are generally made to customer specifications, and we conduct rigorous quality control and testing procedures to ensure that the finished wafers meet the customer’s specifications before the product is shipped. We consider international shipping term definitions in our determination of when title passes. We defer revenue for multiple element arrangements based on an average fair value per unit for the total arrangement when we receive cash in excess of fair value. We also defer revenue when pricing is not fixed or determinable or other revenue recognition criteria is not met.

In connection with certain of our long-term solar wafer supply agreements, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements.

Solar Energy System Sales

Solar energy system sales involving real estate

We recognize revenue for solar energy system sales with the concurrent sale or the concurrent lease of the underlying land, whether explicit or implicit in the transaction, in accordance with ASC 360-20, Real Estate Sales. For these transactions, we evaluate the solar energy system to determine whether the equipment is integral equipment to the real estate; therefore, the entire transaction is in substance the sale of real estate and subject to revenue recognition under ASC 360-20. A solar energy system is determined to be integral equipment when the cost to remove the equipment from its existing location, ship and

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reinstall at a new site, including any diminution in fair value, exceeds ten percent of the fair value of the equipment at the time of original installation. For those transactions subject to ASC 360-20, we recognize revenue and profit using the full accrual method once the sale is consummated, the buyer's initial and continuing investments are adequate to demonstrate its commitment to pay, our receivable is not subject to any future subordination, and we have transferred the usual risk and rewards of ownership to the buyer. If these criteria are met and we execute a sales agreement prior to the delivery of the solar energy system and have an original construction period of three months or longer, we recognize revenue and profit under the percentage of completion method of accounting applicable to real estate sales when we can reasonably estimate progress towards completion. During 2012 and 2011, we recognized $97.8 million and $54.3 million, respectively, of revenue using the percentage of completion method. Prior to 2011, we did not have sales that qualified for using the percentage of completion method.

If the criteria for recognition under the full accrual method are met except that the buyer's initial and continuing investment is less than the level determined to be adequate, then we will recognize revenue using the installment method. Under the installment method, we record revenue up to our costs incurred and apportion each cash receipt from the buyer between cost recovered and profit in the same ratio as total cost and total profit bear to the sales value. During 2012 and 2011, we recognized revenue of $22.7 million and $28.5 million, respectively, using the installment method. Prior to 2011, we did not have sales that qualified for using the installment method.

If we retain some continuing involvement with the solar energy system and do not transfer substantially all of the risks and rewards of ownership, profit shall be recognized by a method determined by the nature and extent of our continuing involvement, provided the other criteria for the full accrual method are met. In certain cases, we may provide our customers guarantees of system performance or uptime for a limited period of time and our exposure to loss is contractually limited based on the terms of the applicable agreement. In accordance with real estate sales accounting guidance, the profit recognized is reduced by our maximum exposure to loss (and not necessarily our most probable exposure), until such time that the exposure no longer exists.

Other forms of continuing involvement that do not transfer substantially all of the risks and rewards of ownership preclude revenue recognition under real estate accounting and require us to account for any cash payments using either the deposit or financing method. Such forms of continuing involvement may include contract default or breach remedies that provide SunEdison with the option or obligation to repurchase the solar energy system. Under the deposit method, cash payments received from customers are reported as deferred revenue for solar energy systems on the consolidated balance sheet, and under the financing method, cash payments received from customers are considered debt and reported as solar energy financing and capital lease obligations on the consolidated balance sheet.

Solar energy system sales not involving real estate

We recognize revenue for solar energy system sales without the concurrent sale or the concurrent lease of the underlying land at the time a sales arrangement with a third party is executed, delivery has occurred and we have determined that the sales price is fixed or determinable and collectible. For transactions that involve a construction period of three months or longer, we recognize the revenue in accordance with ASC 605-35, Construction-Type and Production-Type Contracts, using the percentage of completion method, measured by actual costs incurred for work completed to total estimated costs at completion for each transaction. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and travel costs. Marketing and administration costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are recognized in full during the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and revenue and are recognized in the period in which the revisions are determined.

Solar energy system sales with service contracts

SunEdison frequently negotiates and executes solar energy system sales contracts and post-system-sale service contracts contemporaneously, which we combine and evaluate together as a single arrangement with multiple deliverables. The total arrangement consideration is first separated and allocated to post-system-sale separately priced extended warranty and maintenance service contracts, and the revenue associated with that deliverable is recognized on a straight-line basis over the contract term. The remaining consideration is allocated to each unit of accounting based on the respective relative selling prices, and revenue is recognized for each unit of accounting when the revenue recognition criteria have been met.

Sale with a leaseback

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We are a party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. We must determine the appropriate classification of the sale leaseback on a project-by-project basis because the terms of the solar energy systems lease schedule may differ from the terms applicable to other solar energy systems. In addition, we must determine if the solar energy system is considered integral equipment to the real estate upon which it resides. We do not recognize revenue on the sales transactions for any sales with a leaseback. Instead, revenue is recognized through the sale of electricity and energy credits which are generated as energy is produced. The terms of the lease and whether the system is considered integral to the real estate upon which it resides may result in either one of the following sale leaseback classifications:

Capital lease arrangements

Sale/capital leaseback classification for non-real estate transactions occurs when the terms of the lease schedule for a solar energy system result in a capital lease classification. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system. Under a capital lease, a capitalized leased asset and obligation is recorded at the present value of the minimum lease payments. Any gain on the sale is recorded as a reduction of the capitalized leased asset which is then recognized to cost of goods sold through reduced depreciation expense over the term of the lease. As of the SunEdison acquisition date of November 20, 2009 through December 31, 2012, there were no arrangements which resulted in this accounting.

Financing arrangements

The financing method is applicable when we have determined that the assets under the lease are real estate. This occurs due to either a transfer of land or the transfer of a lease involving real estate and the leased equipment is integral equipment to the real estate. A sale leaseback is classified as a financing sale leaseback if we have concluded the leased assets are real estate and we have a prohibited form of continuing involvement, such as an option or obligation to repurchase the assets under our master lease agreements.

Under a financing sale leaseback, we do not recognize any upfront profit because a sale is not recognized. The full amount of the financing proceeds is recorded as solar energy financing debt, which is typically secured by the solar energy system asset and its future cash flows from energy sales, but generally has no recourse to MEMC or SunEdison under the terms of the arrangement.

We use our incremental borrowing rate to determine the principal and interest component of each lease payment. However, to the extent that our incremental borrowing rate will result in either negative amortization of the financing obligation or a built-in loss at the end of the lease (e.g. net book value of the system asset exceeds the financing obligation), the rate is adjusted to eliminate such results. The interest rate is adjusted accordingly for the majority of our financing leasebacks because our future minimum lease payments do not typically exceed the initial proceeds received from the buyer-lessor. As a result, most of our lease payments are reported as interest expense, the principal of the financing debt does not amortize, and we expect to recognize a gain upon the final lease payment at the end of the lease term equal to the unamortized balance of the financing debt less the write-off of the system assets net book value.

Operations and maintenance

Operations and maintenance revenue is billed and recognized as services are performed. Costs of these revenues are expensed in the period they are incurred.

Solar energy service revenues, energy credits and incentives

For SunEdison-owned or capitalized solar energy systems in the U.S., we may receive incentives or subsidies from various state governmental jurisdictions in the form of renewable energy credits (“RECs”), which we sell to third parties. In the State of California, we may also receive performance-based incentives (“PBIs”) from public utilities in connection with a program sponsored by the State of California. The Solar Energy segment recorded total PBI revenue of $31.4 million, $24.3 million and $18.6 million for the years ended December 31, 2012, 2011 and 2010, respectively, and total REC revenue of $17.3 million, $15.1 million and $7.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. Both the RECs and PBIs are based on the actual level of output generated from the system. RECs are generated as our solar energy systems generate electricity. Typically, SunEdison enters into five to ten year binding contractual arrangements with utility companies or other investors who purchase RECs at fixed rates. REC revenue is recognized at the time SunEdison has transferred a REC pursuant to an executed contract relating to the sale of the RECs to a third party. For PBIs, production from SunEdison-operated systems is verified by an independent third party and, once verified, revenue is recognized based on the terms of the contract and the fulfillment of all revenue recognition criteria. There are no penalties in the event electricity is not produced for PBIs. However, if production does not occur on the systems for which we have sale contracts for our RECs, we may have to purchase RECs on

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the spot market or pay specified contractual damages. Historically, we have not had to purchase material amounts of RECs to fulfill our REC sales contracts.

Recording of a sale of RECs and receipt of PBIs under U.S. GAAP are accounted for under ASC 605, Revenue Recognition. There are no differences in the process and related revenue recognition between REC sales to utilities and non-utility customers. Revenue is recorded when all revenue recognition criteria are met, including: there is persuasive evidence an arrangement exists (typically through a contract), services have been rendered through the production of electricity, pricing is fixed and determinable under the contract and collectability is reasonably assured. For RECs, the revenue recognition criteria are met when the energy is produced and a REC is generated and transferred to a third party pursuant to a contract with that party fixing the price for the REC. For PBIs, revenue is recognized upon validation of the kilowatt hours produced from a third party metering company because the quantities to be billed to the utility are determined and agreed to at that time.

Inventories

Inventories consists of raw materials, labor and manufacturing overhead and are valued at the lower of cost or market. Fixed overheads are allocated to the costs of conversion based on the normal capacity of our production facilities. Unallocated overheads during periods of abnormally low production levels are recognized as cost of goods sold in the period in which they are incurred. Raw materials and supplies are generally stated at weighted-average cost and goods and work-in-process and finished goods inventories are stated at standard cost as adjusted for variances, which approximates weighted-average actual cost. The valuation of inventory requires us to estimate excess and slow moving inventory. The determination of the value of excess and slow moving inventory is based upon assumptions of future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

Inventories also includes raw materials (such as solar panels) and supplies used to construct future solar energy systems developed for sale to third parties, which have not been designated to a specific project as of the balance sheet date. When the inventory is designated for use to build a specific project, the inventory will be reclassified to either solar energy systems held for development and sale or to property, plant and equipment - construction in progress, which is determined based on our intended use of the system. The cost of raw materials for solar energy systems is based on the first-in, first-out (FIFO) method.

Solar Energy Systems Held for Development and Sale

Solar energy systems are classified as either held for development and sale or as property, plant and equipment based on our intended use of the system once constructed and provided that certain criteria to be classified as held for sale are met. The classification of the system affects the future accounting and presentation in the consolidated financial statements, including the consolidated statement of operations and statement of cash flows.  Cash transactions related to the construction and sale of solar energy systems classified as held for development and sale are recorded as operating activities in the consolidated statement of cash flows and within gross margins in the statement of operations when sold.    Solar energy systems that are classified as property, plant and equipment generally relate to our sale leaseback transactions.  The costs to construct solar energy systems classified as property, plant and equipment are recorded in the investing activities of the consolidated statement of cash flows. The proceeds received for the sale and subsequent leaseback are considered financing inflows within the consolidated statement of cash flows.

Solar energy systems held for development include solar energy system project related assets for projects that have commenced and are actively marketed and intended to be sold. Development costs include capitalizable costs for items such as permits, acquired land, deposits and work-in-process, among others. Work-in-process includes materials, labor and other capitalizable costs incurred to construct solar energy systems. 

Solar energy systems held for sale are completed solar energy systems that have been interconnected. Solar energy systems held for sale are available for immediate sale in their present conditions subject only to terms that are usual and customary for sales of these types of assets. In addition, we are actively marketing the systems to potential third party buyers, and it is probable that the system will be sold within one year of its placed in service date. Solar energy systems held for sale also include systems under contract with a buyer that are accounted for using the deposit method, whereby cash proceeds received from the buyer are held as deposits until a sale can be recognized.

We do not depreciate our solar energy systems while classified as held for sale and any energy or incentive revenues are recorded to other income, as such revenues are incidental to our intended use of the system (direct sale to a third party buyer). If facts and circumstances change such that it is no longer probable that the system will be sold within one year of the system's completion date, the system will be reclassified to property, plant and equipment, and we will record depreciation expense in the amount that would have otherwise been recorded during the period the system was classified as held for sale.

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Property, Plant and Equipment

We record property, plant and equipment at cost and depreciate it evenly over the assets’ estimated useful lives as follows:

	Years
Software	3-6
Buildings and improvements	4-60
Machinery and equipment	1-25
Solar energy systems	23-30

Expenditures for repairs and maintenance are charged to expense as incurred. Additions and betterments are capitalized. The cost and related accumulated depreciation on property, plant and equipment sold or otherwise disposed of are removed from the capital accounts and any gain or loss is reported in current-year operations.

We often construct solar energy systems for which we do not have a fixed-price construction contract and, in certain instances, we may construct a system and retain ownership of the system or perform a sale-leaseback. For these projects, we earn revenues associated with the energy generated by the solar energy system, capitalize the cost of construction to solar energy system property, plant and equipment and depreciate the system over its estimated useful life. For solar energy systems under construction for which we intend to retain ownership and finance the system, we recognize all costs incurred as solar system construction in progress.

We may sell a solar energy system and simultaneously lease back the solar energy system. Property, plant and equipment accounted for as capital leases (primarily solar energy systems) are depreciated over the life of the lease. Solar energy systems that have not reached consummation of a sale under real estate accounting and have been leased back are recorded at the lower of the original cost to construct the system or its fair value and depreciated over the equipment's estimated useful life. For those sale leasebacks accounted for as capital leases, the gain, if any, on the sale leaseback transaction is deferred and recorded as a contra-asset that reduces the cost of the solar energy system, thereby reducing depreciation expense over the life of the asset. Generally, as a result of various tax attributes that accrue to the benefit of the lessor/tax owner, solar energy systems accounted for as capital leases are recorded at the net present value of the future minimum lease payments because this amount is lower than the cost and fair market value of the solar energy system at the lease inception date.

Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the remaining lease term, including renewal periods considered reasonably assured of execution.

When we are entitled to incentive tax credits for property, plant and equipment, we reduce the asset carrying value by the amount of the credit, which reduces future depreciation.

Consolidated depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $200.6 million, $217.7 million and $158.9 million, respectively, and includes depreciation expense for capital leases of $4.3 million, $9.7 million and $4.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The cost of constructing facilities, equipment and solar energy systems includes interest costs incurred during the asset's construction period. Capitalized interest totaled $19.9 million, $18.1 million and $5.1 million for the years ended December 31 2012, 2011 and 2010, respectively.

Asset retirement obligations are recognized at fair value in the period in which they are incurred and the carrying amount of the related long-lived asset is correspondingly increased. Over time, the liability is accreted to its expected future value. The corresponding asset capitalized at inception is depreciated over the useful life of the asset. We operate under solar power services agreements with some customers that include a requirement for the removal of the solar energy systems at the end of the term of the agreement. In addition, we could have certain legal obligations for asset retirements related to disposing of materials in the event of closure, abandonment or sale of certain of our manufacturing facilities. We recognize a liability in the period in which we have determined the time frame that the asset will no longer operate and information is available to reasonably estimate the liability’s fair value.

Intangible Assets

Our indefinite-lived intangible assets include power plant development arrangements which relate to anticipated future economic benefits associated with our customer backlog and pipeline relationships.We initially treat backlog and pipeline as indefinite-lived intangible assets, similar to GAAP treatment of in-process R&D, which is not subject to amortization. These intangibles will be allocated to fixed assets as the construction of the related solar energy systems stemming from the existing

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backlog and pipeline is completed and will ultimately be charged to the P&L through COGS or depreciation. These assets are tested annually for impairment on December 1 of each year. December 1 is the date in which the annual impairment review is performed for all indefinite lived intangible assets.

Intangible assets that have determinable estimated lives are amortized over those estimated lives. The straight-line method of amortization is used because it best reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up. The amounts and useful lives assigned to intangible assets acquired impact the amount and timing of future amortization. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets.

The useful lives of our intangible assets subject to amortization are as follows:

	Years
Favorable energy credits	4-18
Customer sales backlog and relationships	1-6
Trade name	15
Developed technology	5

Variable Interest Entities

SunEdison’s business can involve the formation of special purpose vehicles (referred to as “project companies”) to own the project assets and execute agreements for the construction and maintenance of the assets, as well as power purchase agreements or feed in tariff agreements with a buyer who will purchase the electricity generated from the solar energy system once it is operating. SunEdison may establish joint ventures with non-related parties to share in the risks and rewards associated with solar energy system development, which are facilitated through equity ownership of a project company. The project companies engage SunEdison to engineer, procure and construct the solar energy system and may separately contract with SunEdison to perform predefined operational and maintenance services post construction. We evaluate the terms of those contracts as well as the joint venture agreements to determine if the entity is a VIE, as well as if SunEdison is the primary beneficiary.

VIEs are primarily entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions; (b) obligation to absorb expected losses; or (c) right to receive expected residual returns. VIEs must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. A VIE should have only one primary beneficiary, but may not have a primary beneficiary if no party meets the criteria described above.

To determine a VIE's primary beneficiary, an enterprise must perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. Therefore, an enterprise must identify the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, and must therefore consolidate the entity, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. If that evaluation is inconclusive as to which party absorbs a majority of the entity’s expected losses or residual returns, a quantitative analysis is performed to determine the primary beneficiary.

For our consolidated VIEs, we have presented on our consolidated balance sheets, to the extent material, the assets of our consolidated VIEs that can only be used to settle specific obligations of the consolidated VIE, and the liabilities of our consolidated VIEs for which creditors do not have recourse to our general assets outside of the VIE.

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the Company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

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Income Taxes

Deferred income taxes arise because of a different tax basis of assets or liabilities between financial statement accounting and tax accounting, which are known as temporary differences. We record the tax effect of these temporary differences as deferred tax assets (generally items that can be used as a tax deduction or credit in future periods) and deferred tax liabilities (generally items for which we receive a tax deduction, but have not yet been recorded in the consolidated statement of operations). We regularly review our deferred tax assets for realizability, taking into consideration all available evidence, both positive and negative, including historical pre-tax and taxable income (losses), projected future pre-tax and taxable income (losses) and the expected timing of the reversals of existing temporary differences. In arriving at these judgments, the weight given to the potential effect of all positive and negative evidence is commensurate with the extent to which it can be objectively verified. Reportable U.S. GAAP income from SunEdison's financing sale-leaseback transactions in the U.S. is deferred until the end of the lease term, generally 20-25 years, through the non-cash extinguishment of the debt.  However, sale-leaseback transactions generate current U.S. taxable income at the time of the sale, with the timing differences increasing deferred tax assets.  As a result of the continued decline in solar market conditions, the restructuring charges announced in December 2011, and cumulative losses in the U.S. and certain foreign jurisdictions, we recorded a material non-cash valuation allowance against the deferred tax assets at December 31, 2011. See Note 14 for further discussion.

We believe our tax positions are in compliance with applicable tax laws and regulations. Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. Uncertain tax benefits, including accrued interest and penalties, are included as a component of other long-term liabilities because we do not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. The accrual of interest begins in the first reporting period that interest would begin to accrue under the applicable tax law. Penalties, when applicable, are accrued in the financial reporting period in which the uncertain tax position is taken on a tax return. We recognize interest and penalties related to uncertain tax positions in income tax expense, which is consistent with our historical policy. We believe that our income tax accrued liabilities, including related interest, are adequate in relation to the potential for additional tax assessments. There is a risk, however, that the amounts ultimately paid upon resolution of audits could be materially different from the amounts previously included in our income tax expense and, therefore, could have a material impact on our tax provision, net (loss) income and cash flows. We review our accrued liabilities quarterly, and we may adjust such liabilities due to proposed assessments by tax authorities, changes in facts and circumstances, issuance of new regulations or new case law, negotiations between tax authorities of different countries concerning our transfer prices between our subsidiaries, the resolution of entire audits, or the expiration of statutes of limitations. Adjustments are most likely to occur in the year during which major audits are closed.

Due to the restructuring announcement made on in December 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future. We plan foreign remittance amounts based on projected cash flow needs as well as the working capital and long-term investment requirements of our foreign subsidiaries and our domestic operations.

We have made our best estimates of certain income tax amounts included in the financial statements. Application of our accounting policies and estimates, however, involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. In arriving at our estimates, factors we consider include how accurate the estimate or assumptions have been in the past, how much the estimate or assumptions have changed and how reasonably likely such change may have a material impact.

Employee-Related Liabilities

We have a long-term net liability for our consolidated defined benefit pension and other post-employment benefit plans. Our obligations are funded in accordance with provisions of federal law. We recognize the overfunded or underfunded status of a defined benefit postretirement plan as an asset or liability in our statement of financial position and recognize changes in that funded status in the year in which the changes occur through comprehensive income.

Our pension and other post-employment liabilities are actuarially determined, and we use various actuarial assumptions, including the discount rate, rate of salary increase, and expected return on assets, to estimate our costs and obligations. If our assumptions do not materialize as expected, expenditures and costs that we incur could differ from our current estimates. We determine the expected return on plan assets based on our pension plans’ actual asset mix as of the beginning of the year. While the assumed expected rate of return on the U.S. Pension plan assets was 8.5% in both 2012 and 2011, the actual return experienced in our pension plan assets in the comparable periods in 2012 and 2011 was 12.8% and (1.3)%, respectively. We consult with the plans’ actuaries to determine a discount rate assumption that reflects the characteristics of our plans, including

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expected cash outflows from our plans, and utilize an analytical tool that incorporates the concept of a hypothetical yield curve, developed from corporate bond (AA quality) yield information. Assuming a 100 basis point increase in these assumptions, our 2012 pension expense would have been approximately $1.2 million lower. Assuming a 100 basis point decrease in these assumptions, our 2012 pension expense would have been approximately $1.2 million higher.

Effective January 1, 2012, the amortization period for the unamortized loss was changed to the average future life expectancy of the active plan participants, which was derived from an actuarial mortality table. This change was triggered by the small number of active plan participants relative to the total plan participants. Prior to 2012, the amortization period was derived based on the average remaining service period of the active participants expected to receive benefits. This change has reduced the amortization expense related to the unrealized loss.

Stock-Based Compensation

Stock-based compensation expense for all share-based payment awards is based on the estimated grant-date fair value. We recognize these compensation costs net of an estimated forfeiture rate and recognize the compensation costs for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the option vesting term. We recognize stock-based compensation expense for all grants on a straight-line basis over the requisite service period of the entire award for ratable awards. Compensation expense for awards with market or performance conditions reflects the estimated probability that the market and/or performance conditions will be met and is recognized ratably over the service period(s) of the award. We estimate the future forfeiture rate taking into consideration our historical experience during the preceding four fiscal years. For our market condition awards, the grant date fair value was calculated for these awards using a probabilistic approach under a Monte-Carlo simulation taking into consideration volatility, interest rates and expected term.

Determining the appropriate fair value model and calculating the fair value of share-based payment awards require the making of subjective assumptions, including the expected life of the share-based payment awards and stock price volatility. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if factors change and we use different assumptions, our stock-based compensation expense could be materially different in the future. In addition, we are required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If our actual forfeiture rate is materially different from our estimate, the stock-based compensation expense could be significantly different from what we have recorded in the current period.

Contingencies

We are involved in conditions, situations or circumstances in the ordinary course of business with possible gain or loss contingencies that will ultimately be resolved when one or more future events occur or fail to occur. We continually evaluate uncertainties associated with loss contingencies and record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements and (ii) the loss or range of loss can be reasonably estimated. Legal costs are expensed when incurred. Gain contingencies are not recorded until realized or realizable.

Fair Value Measurements

Fair value accounting guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, and are based on market data obtained from sources independent of MEMC. Unobservable inputs reflect assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

• Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that MEMC has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Because valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

• Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Valuations for Level 2 are prepared on an individual instrument basis using data obtained from recent transactions for identical securities in inactive markets or pricing data from similar instruments in active and inactive markets.

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• Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We maintain various financial instruments recorded at cost in the December 31, 2012 and 2011 balance sheets that are not required to be recorded at fair value. For these instruments, we used the following methods and assumptions to estimate the fair value:

• Cash equivalents, restricted cash, accounts receivable and payable, customer deposits, income taxes receivable and payable, short-term borrowings, and accrued liabilities—cost approximates fair value because of the short maturity period; and

• Long-term debt—fair value is based on the amount of future cash flows associated with each debt instrument discounted at our current estimated borrowing rate for similar debt instruments of comparable terms.

Derivative Financial Instruments and Hedging Activities

All derivative instruments are recorded on the consolidated balance sheet at fair value. Derivatives not designated as hedge accounting and used to hedge foreign-currency-denominated balance sheet items are reported directly in earnings along with offsetting transaction gains and losses on the items being hedged. Derivatives used to hedge foreign-currency denominated cash flows and floating rate debt may be accounted for as cash flow hedges, as deemed appropriate. Gains and losses on derivatives designated as cash flow hedges are recorded in other comprehensive (loss) income and reclassified to earnings in a manner that matches the timing of the earnings impact of the hedged transactions. The ineffective portion of all hedges, if any, is recognized currently in earnings. Derivatives used to manage the foreign exchange risk associated with a net investment denominated in another currency are accounted for as a net investment hedge. The effective portion of the hedge will be recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. When the investment is dissolved and MEMC recognizes a gain or loss in other income (expense), the associated hedge gain or loss in other comprehensive (loss) income will be reclassified to other income (expense).

Derivatives not designated as hedging

During 2006, we executed a long-term supply agreement with a customer, Suntech Power Holdings (“Suntech”). At the same time, we received a fully vested, non-forfeitable warrant to purchase common shares of Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The warrant becomes exercisable over a five year period (20% annually) beginning January 1, 2008 and has a five year exercise period from the date each tranche becomes exercisable. The estimated grant date fair value of the warrant was $66.6 million and was recorded to other assets with the offset to non solar energy system deferred revenue – long-term on the consolidated balance sheet. The non-cash transaction was excluded from the consolidated statement of cash flows. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. We used a lattice model to determine the warrant’s fair value. The assumptions used in calculating the fair value of the warrant represented our best estimates, but these estimates involved inherent uncertainties and the application of our judgment.

We generally use currency forward contracts to manage foreign currency exchange risk relating to current trade receivables and payables with our foreign subsidiaries and current trade receivables and payables with our customers and vendors denominated in foreign currencies (primarily Japanese Yen and Euro). The purpose of our foreign currency forward contract activities is to protect us from the risk that the dollar net cash flows resulting from foreign currency transactions will be negatively affected by changes in exchange rates. We do not hold or issue financial instruments for speculative or trading purposes. Gains or losses on our forward exchange contracts, as well as the offsetting losses or gains on the related hedged receivables and payables, are included in non-operating expense (income) in the consolidated statement of operations. Net currency losses on unhedged foreign currency positions totaled $6.6 million, $4.7 million and $0.5 million in 2012, 2011 and 2010, respectively.

Derivatives designated as hedging

In addition to the currency forward contracts purchased to hedge transactional currency risks, we may enter into currency forward contracts to hedge cash flow risks associated with future purchases of raw materials. Our cash flow hedges are designed to protect against the variability in foreign currency rates between a foreign currency and the U.S. Dollar. As of December 31, 2012, there were no currency forward contracts outstanding being accounted for as cash flow hedges.

We are party to four interest rate swap instruments, three of which are accounted for using hedge accounting. The interest rate swaps are used to manage risks generally associated with interest rate fluctuations. Each contract has been accounted for as a qualifying cash flow hedge in accordance with derivative instrument and hedging activities guidance, whereby changes in the fair market value are reflected as adjustments to the fair value of the derivative instruments as reflected in the accompanying

27

consolidated financial statements. The counterparties to these agreements are financial institutions. The fair values of the contracts are estimated by obtaining quotations from the financial institutions. The fair value is an estimate of the net amount that we would pay on December 31, 2012, if the agreements were transferred to other parties or cancelled by us.

Our previous joint venture with Q-Cells SE, which was not consolidated, was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract for 70.0 million Euros. The forward contract met all the criteria for hedge accounting and the derivative instrument was effective as an economic hedge of foreign exchange risk associated with the hedged net investment. The effective portion of the hedge was recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our consolidated statement of operations, as the remaining investment in Q-Cells SE and related forward contracts were liquidated in the fourth quarter of 2010. See Note 5 for further discussion.

Investments

Cost and Equity Method Investments

Cost method investments are initially recorded and subsequently carried at their historical cost and income is recorded to the extent there are dividends. We use the equity method of accounting for our equity investments where we hold more than 20 percent of the outstanding stock of the investee or where we have the ability to significantly influence the operations or financial decisions of the investee. We initially record the investment at cost and adjust the carrying amount each period to recognize our share of the earnings or losses of the investee based on our ownership percentage. We review our equity and cost method investments periodically for indicators of impairment.

Available-for-Sale Investments

Investments designated as available-for-sale are reported at fair value with unrealized gains and losses, net of tax, recorded in accumulated other comprehensive (loss) income. Purchases and sales of available-for-sale investments are included in investing activities in the consolidated statement of cash flows.

Investments are evaluated at each period end date for impairment, including classification as temporary or other-than-temporary. Unrealized losses are recorded to other income and expense when a decline in fair value is determined to be other-than-temporary. We review several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the nature of the investment; (ii) the cause and duration of the impairment; (iii) the extent to which fair value is less than cost; (iv) the financial condition and near term prospects of the issuer; and (v) our ability to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. Realized gains and losses are accounted for on the specific identification method. We determine the fair value of our debt securities using quoted prices from active and inactive markets, traded prices for similar assets, or fair value measurements based on a pricing model. We also review our ability and intent to liquidate our investments within the next 12 month operating cycle to determine the appropriate short or long-term classification. Our ability to liquidate is determined based on a review of current and short-term credit and capital market conditions and the financial condition and near term prospects of the issuer.

ACCOUNTING STANDARDS UPDATES NOT YET EFFECTIVE

In February 2012, the FASB issued Accounting Standards Update No. 2012-2 - Intangibles, Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, which amends FASB ASU 2011-08 and states that companies can use a qualitative approach to measuring Intangibles, Goodwill and Other rather than a quantitative approach. In addition, it is not required for an entity to disclose the quantitative information about significant unobservable inputs used in fair value measurements categorized within level 3 of the fair value hierarchy required by paragraph 820-10-50-2 that relate to the financial accounting and reporting for an indefinite-lived intangible asset after its initial recognition. We have adopted ASU 2012-2 as of January 1, 2013 and do not expect that the adoption will have a material impact on our consolidated financial statements.

28

MARKET RISK

Our market risk is mainly related to financial and capital markets risk.

The overall objective of our financial risk management program is to reduce the potential negative earnings effects from changes in foreign exchange and interest rates arising in our business activities. We manage these financial exposures through operational means and by using various financial instruments. These practices may change as economic conditions change.

To mitigate financial market risks of foreign currency exchange rates, we utilize currency forward contracts. We do not use derivative financial instruments for speculative or trading purposes. We generally hedge transactional currency risks with currency forward contracts. Gains and losses on these foreign currency exposures are generally offset by corresponding losses and gains on the related hedging instruments, resulting in negligible net exposure to MEMC. A substantial majority of our revenue and capital spending is transacted in U.S. Dollars. However, we do enter into transactions in other currencies, primarily, the Euro, the Japanese Yen, the Canadian Dollar and certain other Asian currencies. To protect against reductions in value and volatility of future cash flows caused by changes in foreign exchange rates, we have established transaction-based hedging programs. Our hedging programs reduce, but do not always eliminate, the impact of foreign currency exchange rate movements. In addition to the direct effects of changes in exchange rates, such changes typically affect the volume of sales or the foreign currency sales price as competitors’ products become more or less attractive. Our Taiwan, Malaysia and Singapore based subsidiaries use the U.S. Dollar as their functional currencies for U.S. GAAP purposes and do not hedge New Taiwanese Dollar, Malaysian Ringgit or Singapore Dollar exposures.

Our long-term debt portfolio consists mostly of fixed-rate instruments, but we do have variable rate debt instruments with a carrying amount of $451.3 million as of December 31, 2012, including our Term Loan. Of the $451.3 million, $40.7 million is hedged using interest rate swaps both economically and as cash flow hedges. If the relevant market rate for all of our variable pay-rate borrowings had been 100 basis points higher or lower than actual in 2012, our interest expense would have changed by $3.8 million, partially offset by our interest rate hedges. The notional amounts and fair values of our interest rate cash flow hedges at December 31, 2012 were $40.7 million and $5.0 million loss, respectively. A similar hypothetical 100 basis points higher or lower rate than actual in 2012 would result in an estimated fair value change of approximately $0.4 million. Because these interest rate swaps are accounted for as a cash flow hedge, the change in fair value would be included within other comprehensive income in the balance sheet. We also have interest rate swaps that are considered economic hedges. The change in fair value of the economic swaps would be included in non-operating expense in the statement of operations. The notional amounts and fair values of our economic interest rate swap hedges as of December 31, 2012 is $1.4 million and $0.0 loss, respectively. A similar hypothetical 100 basis points higher or lower rate than actual in 2012 would result in an estimated fair value change of approximately $0.1 million. We are also subject to interest rate risk related to our cash equivalents, pension plan assets and capital leases. In addition to interest rate risk on our cash equivalents and pension plan assets, we are subject to issuer credit risk because the value of our assets may change based on liquidity issues or adverse economic conditions affecting the creditworthiness of the issuers or group of issuers of the assets we may own. Our pension plan assets are invested primarily in marketable securities including common stocks, bonds and interest bearing deposits. See additional discussion in “Liquidity and Capital Resources” and “Critical Accounting Policies and Estimates.” Due to the diversity of and numerous securities in our portfolio, estimating a hypothetical change in value of our portfolio based on estimated changes in interest rates and issuer risk is not practical.

The SunEdison business model is highly sensitive to interest rate fluctuations and the availability of liquidity, and would be adversely affected by increases in interest rates or liquidity constraints. MEMC’s solar energy business requires access to additional capital to fund projected growth. During the construction phase of solar energy systems, MEMC provides short-term working capital support to a project company or may obtain third party construction financing to fund engineering, procurement and installation costs. To the extent that our access to capital is limited or on unfavorable terms, our rate of growth of the Solar Energy segment may be limited by capital access. Additionally, many of our customers and potential customers depend on debt financing to purchase our solar energy systems. An increase in interest rates could make it difficult for our customers to secure the financing necessary to purchase our solar energy systems on favorable terms, or at all, and thus lower demand for our SunEdison products, reduce revenue and adversely impact our operating results. An increase in interest rates could lower a customer’s return on investment in a system or make alternative investments more attractive relative to solar energy systems, which, in each case, could cause our customers to seek alternative investments that promise higher returns or demand higher returns from our solar energy systems, reduce gross margin and adversely impact our operating results.

29

UNAUDITED QUARTERLY FINANCIAL INFORMATION

2012	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Dollars in millions, except per share data
Net sales	$	519.2		$	808.4		$	601.6		$	600.7
Gross profit	50.1			90.4			86.9			108.2
Net (loss) income	(99.5		)	(75.9		)	38.4			(11.7		)
Net loss (income) attributable to noncontrolling interests	0.9			(1.3		)	(1.4		)	(0.1		)
Net (loss) income attributable to MEMC stockholders	(98.6		)	(77.2		)	37.0			(11.8		)
Basic (loss) income per share	(0.43		)	(0.33		)	0.16			(0.05		)
Diluted (loss) income per share	(0.43		)	(0.33		)	0.16			(0.05		)
Market close stock prices:
High	5.95			3.84			3.35			3.41
Low	3.50			1.44			1.68			2.15

Duringthe third quarter 2012, we agreed to terminate a long-term solar wafer agreement with Conergy AG. We recognized $37.1 million as revenue during the third quarter 2012 due to the fact that we were relieved of our future performance obligations under the agreement. See Note 17.

In the third quarter 2012, we executed two settlement agreements with Evonik Industries AG and Evonik Degussa SpA (Evonik) pertaining to disputes arising from our early termination of two take-or-pay supply agreements. One of the original supply agreements also included a provision for the construction and operation of a chlorosilanes plant located on our existing Merano, Italy site for our benefit. Pursuant to the settlement reached, we will pay Evonik a total of 70 million euro as well as forfeit a $10.2 million deposit with Evonik. As a result of the settlement, a favorable adjustment to our 2011 Global Plan was made in the third quarter 2012 resulting in $69.2 million of income classified within restructuring and impairment on the consolidated statement of operations. In the fourth quarter 2012, we obtained title to the chlorosilanes plant, which resulted in $31.7 million of income in the consolidated statement of operations. See Note 3.

In connection with the preparation of our consolidated financial statements for the nine months ended September 30, 2012, management identified an error and revised the amounts previously presented for cost of goods sold due to a non-cash inventory adjustment which eliminated intercompany profit for the three months ended March 31, 2012 and the three and six month periods ended June 30, 2012.

We have determined that the effects of these revisions were not material to previously issued financial statements for the three months ended March 31, 2012 and the three and six months ended June 30, 2012. However, the amounts reflected in the table above have been revised to reflect these adjustments. Specifically, cost of goods sold was increased by $6.6 million for the three months ended March 31, 2012 and by $16.0 million for the three months ended June 30, 2012. As a result, the net loss increased from $92.0 million to $98.6 million for the three months ended March 31, 2012 and the net loss increased from $61.3 million to $77.2 million and from $153.3 million to $175.8 million for the three and six months ended June 30, 2012, respectively. The company will revise the condensed consolidated financial statements for these periods in future filings that contain such financial statements.

30

2011	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
Dollars in millions, except per share data
Net sales	735.9		745.6		516.2		717.8
Gross profit	114.0		181.1		58.6		(58.8	)
Net income (loss)	9.3		47.8		(92.2	)	(1,484.9	)
Net (income) loss attributable to noncontrolling interests	(13.8	)	(0.5	)	(2.2	)	0.5
Net (loss) income attributable to MEMC stockholders	(4.5	)	47.3		(94.4	)	(1,484.4	)
Basic (loss) income per share	(0.02	)	0.21		(0.41	)	(6.44	)
Diluted (loss) income per share	(0.02	)	0.21		(0.41	)	(6.44	)
Market close stock prices:
High	14.84		12.75		8.58		6.73
Low	11.00		8.04		4.98		3.67

Net sales includes $149.4 million, $19.4 million, and $6.9 million of revenue recognized under the Suntech contract resolution during the second, third and fourth quarters of 2011, respectively. See Note 17.

Inventory charges of $14.2 million, $20.1 million and $79.3 million were recorded during the second, third and fourth quarter of 2011, respectively, due primarily to to the sharp decline in solar wafer pricing and the underutilization of our Kuching solar wafering plant as we implement new technologies. Additionally, due to the earthquake in Japan on March 11, 2011, wafer production in our semiconductor wafer plant in Japan was suspended from that time through April 12, 2011. Due to the unplanned downtime, we recorded $7.7 million and $7.2 million in the second and third quarter of 2011, respectively, as period charges to cost of goods sold for the under absorption of production costs.

In the third and fourth quarters of 2011, we recorded goodwill impairment charges of $56.4 million and $384.1 million, respectively. See Note 3.

During the fourth quarter of 2011, as a result of market conditions, in order to better align our business to current and expected market conditions in the semiconductor and solar markets as well as to improve our overall cost competitiveness and increase cash flow generation across all segments, MEMC committed to a series of actions to reduce the company's global workforce, right size its production capacity and accelerate operating cost reductions in 2012 and beyond. The impact of these initiatives resulted in the following charges during the fourth quarter: $339.5 million in restructuring charges, $365.4 million of long-lived asset impairments, and $67.3 million in impairments on two of our joint ventures accounted for under the equity method. Restructuring charges of $13.6 million were recorded during the second quarter of 2011. See Note 3.

In the fourth quarter of 2011, we recorded an impairment charge of $11.6 million on an investment accounted for under the cost method as an other-than-temporary impairment was determined to have occurred. See Note 3.

In 2011, changes in the valuation allowance on our deferred tax assets resulted in an income tax benefit of $7.1 million and $8.6 million in the second and third quarter, respectively, and an income tax expense of $384.2 million in the fourth quarter. See Note 14.

31

Consolidated Statements of Operations

	For the year ended December 31,
	2012			2011			2010
In millions, except per share data
Net sales	$	2,529.9		$	2,715.5		$	2,239.2
Cost of goods sold	2,194.3			2,420.6			1,902.1
Gross profit	335.6			294.9			337.1
Operating expenses:
Marketing and administration	306.2			352.8			267.0
Research and development	71.8			87.5			55.6
Goodwill impairment charges (see Note 10)	—			440.5			—
Restructuring (reversals) charges (see Note 3)	(83.5		)	350.7			5.3
Gain on receipt of property, plant and equipment (see Note 3)	(31.7		)	—			—
Long-lived asset impairment charges (see Note 9)	19.6			367.9			—
Insurance recovery	(4.0		)	(4.0		)	(11.9		)
Operating income (loss)	57.2			(1,300.5		)	21.1
Non-operating expenses (income):
Interest expense	135.3			77.2			29.0
Interest income	(3.6		)	(4.5		)	(5.5		)
Decline in fair value of warrant	0.2			4.8			14.0
Other, net	6.8			6.1			(3.9		)
Total non-operating expenses	138.7			83.6			33.6
Loss before income tax expense (benefit) and equity in (loss) earnings of joint ventures	(81.5		)	(1,384.1		)	(12.5		)
Income tax expense (benefit)	64.9			73.1			(53.3		)
(Loss) income before equity in (loss) earnings of joint ventures	(146.4		)	(1,457.2		)	40.8
Equity in (loss) earnings of joint ventures, net of tax	(2.3		)	(62.8		)	7.2
Net (loss) income	(148.7		)	(1,520.0		)	48.0
Net income attributable to noncontrolling interests	(1.9		)	(16.0		)	(13.6		)
Net (loss) income attributable to MEMC stockholders	$	(150.6	)	$	(1,536.0	)	$	34.4
Basic (loss) income per share (see Note 13)	$	(0.66	)	$	(6.68	)	$	0.15
Diluted (loss) income per share (see Note 13)	$	(0.66	)	$	(6.68	)	$	0.15

See accompanying notes to consolidated financial statements.

32

Consolidated Statement of Comprehensive (Loss) Income

	For the year ended December 31,
	2012			2011			2010
In millions
Net (loss) income	$	(148.7	)	$	(1,520.0	)	$	48.0
Other comprehensive (loss) income, net of tax:
Net translation adjustments	(18.5		)	(2.5		)	16.2
Net unrealized loss on available-for-sale securities	(2.8		)	(24.9		)	(2.9		)
(Loss) gain on hedging instruments	(0.4		)	7.1			(11.0		)
Net actuarial loss and prior service credit (net of ($10.5), $10.5, ($2.8) tax, respectively)	(11.9		)	(16.0		)	(0.6		)
Other comprehensive (loss) income, net of tax	(33.6		)	(36.3		)	1.7
Total comprehensive (loss) income	(182.3		)	(1,556.3		)	49.7
Net income attributable to noncontrolling interests	(1.9		)	(16.0		)	(13.6		)
Net translation adjustment attributable to noncontrolling interests	(2.3		)	(1.7		)	(0.6		)
Comprehensive (loss) income attributable to MEMC stockholders	$	(186.5	)	$	(1,574.0	)	$	35.5

See accompanying notes to consolidated financial statements.

33

Consolidated Balance Sheets

	As of December 31,
	2012		2011
In millions, except per share data
Assets
Current assets:
Cash and cash equivalents	$	572.6	$	585.8
Restricted cash	72.4		125.2
Accounts receivable, net	220.4		202.9
Inventories	247.8		321.8
Solar energy systems held for development and sale	133.8		373.0
Prepaid and other current assets	212.2		277.2
Total current assets	1,459.2		1,885.9
Investments	49.6		54.5
Property, plant and equipment, net:
Non-solar energy systems	1,213.1		1,253.7
Solar energy systems including consolidated variable interest entities of $53.1 and $55.3 in 2012 and 2011, respectively	1,459.9		1,139.4
Deferred tax assets, net	—		44.8
Restricted cash	50.2		37.5
Other assets	355.4		316.6
Intangible assets, net	114.2		149.2
Total assets	$	4,701.6	$	4,881.6

See accompanying notes to consolidated financial statements.

34

	As of December 31,
	2012			2011
In millions, except per share data
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	3.4		$	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations, including consolidated variable interest entities of $2.9 and $5.6 at December 31, 2012 and 2011, respectively	97.8			144.2
Accounts payable	477.0			694.6
Accrued liabilities	344.2			409.0
Contingent consideration related to acquisitions	23.1			71.6
Deferred revenue for solar energy systems	113.1			41.4
Customer and other deposits	77.2			72.4
Total current liabilities	1,135.8			1,436.9
Long-term debt and capital lease obligations, less current portion	758.7			567.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion, including consolidated variable interest entities of $69.2 and $57.0 at December 31, 2012 and 2011, respectively	1,508.4			1,211.2
Pension and post-employment liabilities	52.7			69.4
Customer and other deposits	184.5			276.8
Deferred revenue for solar energy systems	146.0			157.4
Non solar energy systems deferred revenue	29.2			51.2
Other liabilities	208.9			326.1
Total liabilities	4,024.2			4,096.7
Redeemable noncontrolling interest	11.3			—
Stockholders’ equity:
Preferred stock, $.01 par value, 50.0 shares authorized, none issued or outstanding at December 31, 2012 or 2011	—			—
Common stock, $.01 par value, 300.0 shares authorized, 241.9 and 241.3 issued at December 31, 2012 and 2011, respectively	2.4			2.4
Additional paid-in capital	647.7			621.7
Retained earnings	425.3			577.5
Accumulated other comprehensive loss	(39.8		)	(3.9		)
Treasury stock, 10.6 and 10.5 shares at December 31, 2012 and 2011, respectively	(460.3		)	(459.8		)
Total MEMC stockholders’ equity	575.3			737.9
Noncontrolling interests	90.8			47.0
Total stockholders’ equity	666.1			784.9
Total liabilities and stockholders’ equity	$	4,701.6		$	4,881.6

See accompanying notes to consolidated financial statements.

35

Consolidated Statements of Cash Flows

	For the year ended December 31,
	2012			2011			2010
In millions
Cash flows from operating activities:
Net (loss) income	$	(148.7	)	$	(1,520.0	)	$	48.0
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation and amortization	246.9			227.1			164.8
Goodwill impairment charges	—			440.5			—
Long-lived asset impairment charges	20.0			381.7			—
Investment impairments	3.6			78.9			—
Stock-based compensation	31.7			43.9			51.6
Deferred revenue recognized	(73.8		)	(67.9		)	(13.1		)
Provision (benefit) for deferred taxes	10.5			60.0			(44.7		)
Loss on supplier contracts	—			77.9			—
Change in contingent consideration for acquisitions	13.3			(25.2		)	(3.0		)
Other	12.9			6.0			(17.4		)
Changes in operating assets and liabilities (net of effects from acquisitions):
Accounts receivable	(19.6		)	73.6			(117.2		)
Inventories	94.8			(108.2		)	(65.0		)
Solar energy systems held for sale and development	(72.4		)	(167.5		)	(158.5		)
Income taxes receivable and payable	8.7			(16.5		)	81.4
Prepaid and other current assets	5.6			27.8			(179.0		)
Accounts payable and accrued liabilities	(343.7		)	226.2			443.3
Non solar energy system deferred revenue and customer deposits	(33.9		)	109.5			48.4
Deferred revenue for solar energy systems	121.5			123.4			78.8
Pension and post-employment liabilities	1.8			11.0			2.4
Working capital and other	(142.7		)	2.5			26.8
Net cash (used in) provided by operating activities	(263.5		)	(15.3		)	347.6
Cash flows from investing activities:
Capital expenditures	(139.0		)	(452.5		)	(352.0		)
Construction of solar energy systems	(346.9		)	(598.1		)	(280.1		)
Cash paid for acquisitions, net of cash acquired	—			(164.0		)	(73.5		)
Proceeds from sale and maturities of investments	—			—			185.0
Proceeds from equity method investments	5.8			95.7			85.3
Purchase of cost and equity method investments	(47.8		)	(50.4		)	(18.8		)
Cash received from net investment hedge	—			—			17.6
Receipts from (payments to) vendors for refundable deposits on long-term agreements and loans	8.6			(14.5		)	(85.0		)
Change in restricted cash, net	6.7			(123.8		)	(1.8		)
Proceeds from sale of property plant and equipment	—			43.9			—
Other	0.1			0.8			1.5
Net cash used in investing activities	(512.5		)	(1,262.9		)	(521.8		)

36

Cash flows from financing activities:
Proceeds from long-term debt	196.0			550.0			—
Proceeds from solar energy system financing and capital lease obligations	904.2			1,071.2			364.4
Repayments of solar energy system financing and capital lease obligations	(246.2		)	(266.5		)	(61.1		)
Net repayments of customer deposits related to long-term supply agreements	(24.4		)	(57.7		)	(31.3		)
Principal payments on long-term debt	(3.6		)	(3.7		)	(4.8		)
Cash paid for contingent consideration	(69.2		)	(50.2		)	—
Receipts from (purchases of) noncontrolling interest	50.8			(49.0		)	(8.3		)
Common stock repurchases	(0.5		)	(3.6		)	(2.9		)
Payment of debt financing fees	(42.3		)	(39.8		)	(12.8		)
Net cash provided by financing activities	764.8			1,150.7			243.2
Effect of exchange rate changes on cash and cash equivalents	(2.0		)	6.0			5.6
Net (decrease) increase in cash and cash equivalents	(13.2		)	(121.5		)	74.6
Cash and cash equivalents at beginning of period	585.8			707.3			632.7
Cash and cash equivalents at end of period	$	572.6		$	585.8		$	707.3

See accompanying notes to consolidated financial statements.

37

Consolidated Statements of Stockholders’ Equity

	Equity Attributable to Redeemable Noncontrolling Interests	Common Stock Issued			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income			Common Stock Held in Treasury					Total MEMC Stockholders’ Equity			Noncontrolling Interests			Total Stockholders’ Equity
		Shares	Amount									Shares		Amount
In millions
Balance at December 31, 2009	—	237.2	$	2.4	$	507.4	$	2,079.1	$	33.0		(9.8	)	$	(453.3	)	$	2,168.6		$	38.2		$	2,206.8
Comprehensive income:
Net income	—	—	—		—		34.4		—			—		—			34.4			13.6			48.0
Net translation adjustment	—	—	—		—		—		15.6			—		—			15.6			0.6			16.2
Net unrecognized actuarial loss and prior service credit (net of $2.5 tax)	—	—	—		—		—		(0.6		)	—		—			(0.6		)	—			(0.6		)
Loss on mark-to-market for cash flow hedges	—	—	—		—		—		(11.0		)	—		—			(11.0		)	—			(11.0		)
Net unrealized loss on available-for-sale securities	—	—	—		—		—		(2.9		)	—		—			(2.9		)	—			(2.9		)
Total comprehensive income	—																35.5			14.2			49.7
Stock plans, net	—	0.7	—		50.5		—		—			(0.2	)	(2.9		)	47.6			—			47.6
Net repayments to noncontrolling interest	—	—	—		—		—		—			—		—			—			(8.5		)	(8.5		)
Balance at December 31, 2010	—	237.9	$	2.4	$	557.9	$	2,113.5	$	34.1		(10.0	)	$	(456.2	)	$	2,251.7		$	43.9		$	2,295.6

See accompanying notes to consolidated financial statements.

	Equity Attributable to Redeemable Noncontrolling Interests	Common Stock Issued			Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive (Loss) Income			Common Stock Held in Treasury					Total MEMC Stockholders’ Equity			Noncontrolling Interests		Total Stockholders’ Equity
		Shares	Amount										Shares		Amount
In millions
Balance at December 31, 2010	—	237.9	$	2.4	$	557.9	$	2,113.5		$	34.1		(10.0	)	$	(456.2	)	$	2,251.7		$	43.9	$	2,295.6
Comprehensive loss:
Net loss	—	—	—		—		(1,536.0		)	—			—		—			(1,536.0		)	16.0		(1,520.0		)
Net translation adjustment	—	—	—		—		—			(4.2		)	—		—			(4.2		)	1.7		(2.5		)
Net unrecognized actuarial loss and prior service credit (net of $10.5 tax)	—	—	—		—		—			(16.0		)	—		—			(16.0		)	—		(16.0		)
Gain on mark-to-market for cash flow hedges	—	—	—		—		—			7.1			—		—			7.1			—		7.1

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Net unrealized loss on available-for-sale securities	—		—	—		—			—			(24.9		)	—		—			(24.9		)	—			(24.9		)
Total comprehensive loss	—																			(1,574.0		)	17.7			(1,556.3		)
Stock plans, net			1.3	—		40.4			—			—			(0.5	)	(3.6		)	36.8			—			36.8
Stock issued for SunEdison contingent consideration	—		2.1	—		24.5			—			—			—		—			24.5			—			24.5
Acquired non-controlling interests	—		—	—		—			—			—			—		—			—			39.7			39.7
Net repayments to noncontrolling interest	—		—	—		(1.1		)	—			—			—		—			(1.1		)	(54.3		)	(55.4		)
Balance at December 31, 2011	—		241.3	$	2.4	$	621.7		$	577.5		$	(3.9	)	(10.5	)	$	(459.8	)	$	737.9		$	47.0		$	784.9
Comprehensive loss:
Net (loss) income	(0.3	)	—	—		—			(150.6		)	—			—		—			(150.6		)	1.9			(148.7		)
Net translation adjustment	—		—	—		—			—			(20.8		)	—		—			(20.8		)	2.3			(18.5		)
Net unrecognized actuarial loss and prior service credit (net of $10.5 tax credit)	—		—	—		—			—			(11.9		)	—		—			(11.9		)	—			(11.9		)
Loss on mark-to-market for cash flow hedges	—		—	—		—			—			(0.4		)	—		—			(0.4		)	—			(0.4		)
Net unrealized loss on available-for-sale securities	—		—	—		—			—			(2.8		)	—		—			(2.8		)	—			(2.8		)
Total comprehensive (loss) income	—		—	—		—			—			—			—		—			$	(186.5	)	$	4.2		$	(182.3	)
Stock plans, net	—		0.6	—		26.0			—			—			(0.1	)	(0.5		)	25.5			—			25.5
Fair value adjustment to redeemable non-controlling interest	1.6		—	—		—			(1.6		)	—			—		—			(1.6		)	—			(1.6		)
Net contributions from noncontrolling interests	10.0		—	—		—			—			—			—		—			—			39.6			39.6
Balance at December 31, 2012	11.3		241.9	$	2.4	$	647.7		$	425.3		$	(39.8	)	(10.6	)	$	(460.3	)	$	575.3		$	90.8		$	666.1

See accompanying notes to consolidated financial statements.

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Notes to Consolidated Financial Statements

1. NATURE OF OPERATIONS

MEMC is a global leader in the development, manufacture and sale of silicon wafers, and a major developer and seller of photovoltaic energy solutions. Through SunEdison, MEMC is one of the world’s leading developers of solar energy projects and, we believe, one of the most geographically diverse. MEMC’s technology leadership in silicon and downstream solar are enabling the company to expand its customer base and lower costs throughout the silicon supply chain.

From January 1, 2010 until December 31, 2011, MEMC was organized by end market, with three business segments: Semiconductor Materials, Solar Materials, and Solar Energy. Semiconductor Materials provides silicon wafers ranging from 100 millimeter (4 inch) to 300 millimeter (12 inch) as the base material for the production of semiconductor devices. Solar Materials manufactured and sold silicon wafers for solar applications, primarily 156 millimeter. Solar Energy was comprised of the SunEdison solar energy business unit which designed, developed, and constructed solar energy systems. During the fourth quarter of 2011, we initiated a large scale global restructuring plan across all of our reportable segments (see Note 3). As part of our restructuring plan, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date, we have been engaged in two reportable segments, Semiconductor Materials and Solar Energy. These consolidated financial statements and related notes to the consolidated financial statements, including prior year financial information, are presented based on two reporting segments for all periods presented.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

In preparing our financial statements, we use estimates and assumptions that may affect reported amounts and disclosures. Estimates are used when accounting for investments, depreciation, amortization, leases, accrued liabilities including restructuring, warranties, employee benefits, derivatives, stock-based compensation, income taxes, solar energy system installation and related costs, percentage-of-completion on long-term construction contracts, the fair value of assets and liabilities recorded in connection with business combinations, and goodwill and asset recoverability, including allowances, among others. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. To the extent there are material differences between the estimates and actual results, our future results of operations would be affected.

Reclassifications

Certain amounts in prior fiscal years have been reclassified to conform with the presentation adopted in the current fiscal year.

Principles of Consolidation

Our consolidated financial statements include the accounts of MEMC Electronic Materials, Inc. and our wholly and majority-owned subsidiaries as well as variable interest entities ("VIEs") for which we are the primary beneficiary. We record noncontrolling interests for non-wholly owned consolidated subsidiaries. As of December 31, 2012 and December 31, 2011 our total noncontrolling interest on the consolidated balance sheet was $90.8 million and $47.0 million, respectively. In 2012, SunEdison entered into a joint venture related to the construction and operation of solar energy systems in South Africa, where there is a partial equity holding requirement. As of December 31, 2012, approximately $34.0 million of equity investments had been received by joint venture partners for the development of the solar energy systems. All significant intercompany balances and transactions among our consolidated subsidiaries have been eliminated. We have also eliminated our pro-rata share of sales, costs of goods sold and profits related to sales to equity method investees.

Variable Interest Entities

SunEdison’s business can involve the formation of special purpose vehicles (referred to as “project companies”) to own the project assets and execute agreements for the construction and maintenance of the assets, as well as power purchase agreements or feed in tariff agreements with a buyer who will purchase the electricity generated from the solar energy system once it is operating. SunEdison may establish joint ventures with non-related parties to share in the risks and rewards associated with solar energy system development, which are facilitated through equity ownership of a project company. The project companies engage SunEdison to engineer, procure and construct the solar energy system and may separately contract with SunEdison to

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perform predefined operational and maintenance services post construction. We evaluate the terms of those contracts as well as the joint venture agreements to determine if the entity is a VIE, as well as if SunEdison is the primary beneficiary.

VIEs are primarily entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions; (b) obligation to absorb expected losses; or (c) right to receive expected residual returns. VIEs must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. A VIE should have only one primary beneficiary, but may not have a primary beneficiary if no party meets the criteria described above.

To determine a VIE's primary beneficiary, an enterprise must perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. Therefore, an enterprise must identify the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, and must therefore consolidate the entity, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. If that evaluation is inconclusive as to which party absorbs a majority of the entity’s expected losses or residual returns, a quantitative analysis is performed to determine the primary beneficiary.

For our consolidated VIEs, we have presented on our consolidated balance sheets, to the extent material, the assets of our consolidated VIEs that can only be used to settle specific obligations of the consolidated VIE, and the liabilities of our consolidated VIEs for which creditors do not have recourse to our general assets outside of the VIE.

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the Company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

Cash and Cash Equivalents

Cash equivalents include highly liquid commercial paper, time deposits and money market funds with original maturity periods of three months or less when purchased. The majority of our cash and cash equivalents are held outside the U.S. Total cash and cash equivalents maintained by foreign subsidiaries whose functional currency is not the U.S. dollar were $171.5 million and $64.2 million as of December 31, 2012 and 2011, respectively. Cash and cash equivalents consist of the following:

	As of December 31,
	2012		2011
Dollars in millions
Cash	$	514.5	$	417.0
Cash Equivalents:
Commercial paper	10.0		10.0
Money market funds	48.1		158.8
	$	572.6	$	585.8

Restricted Cash

Restricted cash consists of cash on deposit in financial institutions that is restricted from use in operations. In certain transactions, we have agreed to issue a letter of credit or provide security deposits regarding the performance or removal of a solar energy system. Incentive application fees are deposited with local governmental jurisdictions which are held until the construction of the applicable solar energy system is completed. In addition, cash received during the lease term of a sale leaseback transaction may be subject to a security and disbursement agreement which generally establishes a reserve requirement for scheduled lease payments under our master lease agreements as discussed below under Revenue Recognition, Solar Energy System Sales, Sale with a leaseback, for each leaseback arrangement, as well as certain additional reserve requirements that may be temporarily required in an accrual account. All of the reserve requirements for scheduled lease payments for all projects under each master lease agreement must be satisfied before cash is disbursed under the master lease agreements.

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Allowance for Doubtful Accounts

We establish an allowance for doubtful accounts to adjust our receivables to amounts considered to be ultimately collectible. Our allowance is based on a variety of factors, including the length of time receivables are past due, significant one-time events, the financial health of our customers and historical experience. The balance of our allowance for doubtful accounts was $4.4 million and $4.9 million as of December 31, 2012 and 2011, respectively. Our provision for bad debts was a $0.3 millionbenefit, due to the recovery of previously written off accounts, $1.4 millionexpense and $1.4 millionbenefit for the years ended December 31, 2012, 2011 and 2010, respectively. There were $0.2 million, $4.3 million and $0.7 million of write-offs for bad debts for the years ended December 31, 2012, 2011, and 2010 respectively.

Inventories

Inventories consists of raw materials, labor and manufacturing overhead and are valued at the lower of cost or market. Fixed overheads are allocated to the costs of conversion based on the normal capacity of our production facilities. Unallocated overheads during periods of abnormally low production levels are recognized as cost of goods sold in the period in which they are incurred. Raw materials and supplies are generally stated at weighted-average cost and goods and work-in-process and finished goods inventories are stated at standard cost as adjusted for variances, which approximates weighted-average actual cost. The valuation of inventory requires us to estimate excess and slow moving inventory. The determination of the value of excess and slow moving inventory is based upon assumptions of future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

Inventories also includes raw materials (such as solar panels) and supplies used to construct future solar energy systems developed for sale to third parties, which have not been designated to a specific project as of the balance sheet date. When the inventory is designated for use to build a specific project, the inventory will be reclassified to either solar energy systems held for development and sale or to property, plant and equipment - construction in progress, which is determined based on our intended use of the system. The cost of raw materials for solar energy systems is based on the first-in, first-out (FIFO) method.

Solar Energy Systems Held for Development and Sale

Solar energy systems are classified as either held for development and sale or as property, plant and equipment based on our intended use of the system once constructed and provided that certain criteria to be classified as held for sale are met. The classification of the system affects the future accounting and presentation in the consolidated financial statements, including the consolidated statement of operations and statement of cash flows.  Transactions related to the construction and sale of solar energy systems classified as held for development and sale are classified as operating activities in the consolidated statement of cash flows and within gross profit in the statement of operations when sold.  Solar energy systems that are classified as property, plant and equipment generally relate to our sale leaseback transactions.  The costs to construct solar energy systems classified as property, plant and equipment are classified in the investing activities of the consolidated statement of cash flows. The proceeds received for the sale and subsequent leaseback are classified as cash flows from financing activities within the consolidated statement of cash flows.

Solar energy systems held for development include solar energy system project related assets for projects that have commenced and are actively marketed and intended to be sold. Development costs include capitalizable costs for items such as permits, acquired land, deposits and work-in-process, among others. Work-in-process includes materials, labor and other capitalizable costs incurred to construct solar energy systems. 

Solar energy systems held for sale are completed solar energy systems that have been interconnected. Solar energy systems held for sale are available for immediate sale in their present conditions subject only to terms that are usual and customary for sales of these types of assets. In addition, we are actively marketing the systems to potential third party buyers, and it is probable that the system will be sold within one year of its placed in service date. Solar energy systems held for sale also include systems under contract with a buyer that are accounted for using the deposit method, whereby cash proceeds received from the buyer are held as deposits until a sale can be recognized.

We do not depreciate our solar energy systems while classified as held for sale. Any energy or incentive revenues are recorded to other income, as such revenues are incidental to our intended use of the system (direct sale to a third party buyer). If facts and circumstances change such that it is no longer probable that the system will be sold within one year of the system's completion date, the system will be reclassified to property, plant and equipment, and we will record depreciation expense in the amount that would have otherwise been recorded during the period the system was classified as held for sale.

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Investments

Cost and Equity Method Investments

Cost method investments are initially recorded and subsequently carried at their historical cost and income is recorded to the extent there are dividends. We use the equity method of accounting for our equity investments where we hold more than 20 percent of the outstanding stock of the investee or where we have the ability to significantly influence the operations or financial decisions of the investee. We initially record the investment at cost and adjust the carrying amount each period to recognize our share of the earnings or losses of the investee based on our ownership percentage. We review our equity and cost method investments periodically for indicators of impairment.

Available-for-Sale Investments

Investments designated as available-for-sale are reported at fair value with unrealized gains and losses, net of tax, recorded in accumulated other comprehensive (loss) income. Purchases and sales of available-for-sale investments are included in investing activities in the consolidated statement of cash flows.

Investments are evaluated at each period end date for impairment, including classification as temporary or other-than-temporary. Unrealized losses are recorded to other income and expense when a decline in fair value is determined to be other-than-temporary. We review several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the nature of the investment; (ii) the cause and duration of the impairment; (iii) the extent to which fair value is less than cost; (iv) the financial condition and near term prospects of the issuer; and (v) our ability to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. Realized gains and losses are accounted for on the specific identification method. We determine the fair value of our debt securities using quoted prices from active and inactive markets, traded prices for similar assets, or fair value measurements based on a pricing model. We also review our ability and intent to liquidate our investments within the next 12 month operating cycle to determine the appropriate short or long-term classification. Our ability to liquidate is determined based on a review of current and short-term credit and capital market conditions and the financial condition and near term prospects of the issuer.

Property, Plant and Equipment

We record property, plant and equipment at cost and depreciate it evenly over the assets’ estimated useful lives as follows:

	Years
Software	3-6
Buildings and improvements	4-60
Machinery and equipment	1-25
Solar energy systems	23-30

Expenditures for repairs and maintenance are charged to expense as incurred. Additions and betterments are capitalized. The cost and related accumulated depreciation on property, plant and equipment sold or otherwise disposed of are removed from the capital accounts and any gain or loss is reported in current-year operations.

We often construct solar energy systems for which we do not have a fixed-price construction contract and, in certain instances, we may construct a system and retain ownership of the system or perform a sale-leaseback. For these projects, we earn revenues associated with the energy generated by the solar energy system, capitalize the cost of construction to solar energy system property, plant and equipment and depreciate the system over its estimated useful life. For solar energy systems under construction for which we intend to retain ownership and finance the system, we recognize all costs incurred as solar system construction in progress.

We may sell a solar energy system and simultaneously lease back the solar energy system. Property, plant and equipment accounted for as capital leases (primarily solar energy systems) are depreciated over the life of the lease. Solar energy systems that have not reached consummation of a sale under real estate accounting and have been leased back are recorded at the lower of the original cost to construct the system or its fair value and depreciated over the equipment's estimated useful life. For those sale leasebacks accounted for as capital leases, the gain, if any, on the sale leaseback transaction is deferred and recorded as a contra-asset that reduces the cost of the solar energy system, thereby reducing depreciation expense over the life of the asset. Generally, as a result of various tax attributes that accrue to the benefit of the lessor/tax owner, solar energy systems accounted for as capital leases are recorded at the net present value of the future minimum lease payments because this amount is lower than the cost and fair market value of the solar energy system at the lease inception date.

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Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the remaining lease term, including renewal periods considered reasonably assured of execution.

When we are entitled to incentive tax credits for property, plant and equipment, we reduce the asset carrying value by the amount of the credit, which reduces future depreciation.

Consolidated depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $200.6 million, $217.7 million and $158.9 million, respectively, and includes depreciation expense for capital leases of $4.3 million, $9.7 million and $4.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The cost of constructing facilities, equipment and solar energy systems includes interest costs incurred during the asset's construction period. Capitalized interest totaled $19.9 million, $18.1 million and $5.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Asset retirement obligations are recognized at fair value in the period in which they are incurred and the carrying amount of the related long-lived asset is correspondingly increased. Over time, the liability is accreted to its expected future value. The corresponding asset capitalized at inception is depreciated over the useful life of the asset. We operate under solar power services agreements with some customers that include a requirement for the removal of the solar energy systems at the end of the term of the agreement. In addition, we could have certain legal obligations for asset retirements related to disposing of materials in the event of closure, abandonment or sale of certain of our manufacturing facilities. We recognize a liability in the period in which we have determined the time frame that the asset will no longer operate and information is available to reasonably estimate the liability’s fair value.

Impairment of Property, Plant and Equipment

We periodically assess the impairment of long-lived assets/asset groups when conditions indicate a possible loss. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using: (i) quoted market prices or (ii) discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. We recorded asset impairment charges in 2012 and 2011; no similar charges were recorded in 2010. See Note 9 for additional discussion on the impairment charges on long-lived assets.

Goodwill and Intangible Assets

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired and liabilities assumed. Goodwill and intangible assets determined to have indefinite lives are not amortized, but rather are subject to an impairment test annually, on December 1, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Our indefinite-lived intangible assets include power plant development arrangements acquired in a business combination which relate to anticipated future economic benefits associated with our customer backlog relationships. These intangible assets will be allocated to fixed assets as the construction of the related solar energy systems stemming from the existing backlog is completed.

The goodwill impairment test involves a two-step approach. Under the first step, we determine the fair value of each reporting unit to which goodwill has been assigned. We compare the fair value of the reporting unit to its carrying value, including goodwill. If the estimated fair value exceeds the carrying value, no impairment loss is recognized. If the carrying value exceeds the fair value, goodwill is considered potentially impaired and the second step is completed in order to measure the impairment loss. Under the second step, if applicable, we calculate the implied fair value of goodwill by deducting the fair value of all tangible and intangible net assets, including any unrecognized intangible assets, of the reporting unit from the fair value of the reporting unit as determined in the first step.

We then compare the implied fair value of goodwill to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, we recognize an impairment loss equal to the difference. See Note 10 for discussion on the goodwill impairment charges recorded during the year ended December 31, 2011. As of December 31, 2012, we had no remaining goodwill.

Intangible assets that have determinable estimated lives are amortized over those estimated lives. The straight-line method of amortization is used because it best reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up. The amounts and useful lives assigned to intangible assets acquired impact the amount and timing of future amortization. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is

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impairment, the impaired asset is written down to fair value, which is typically calculated using discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. During 2012 and 2011 we recorded intangible asset impairments; see Note 10. No similar charges were recorded in 2010.

The estimated useful lives of our intangible assets subject to amortization are as follows:

	Years
Favorable energy credits	4-18
Customer sales backlog and relationships	1-6
Trade name	15
Developed technology	5

Operating Leases

We enter into lease agreements for a variety of business purposes, including office and manufacturing space, office and manufacturing equipment and computer equipment. A portion of these are noncancellable operating leases.

Capital Leases

We are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. For those transactions which do not fall under real estate accounting, we record a lease liability and the solar energy system is retained on our balance sheet. The excess of the cash proceeds of the sale leaseback over the costs to construct the solar energy system is retained by us and used to fund current operations and new solar energy projects. See further discussion in Revenue Recognition below.

Customer and Other Deposits

We have executed long-term solar wafer supply agreements, including amendments, with multiple customers which required the customers to provide security deposits. The terms of these deposits vary, but are generally required to be applied against a portion of current sales on credit or refunded to customers over the term of the applicable agreement. We also receive short-term deposits from customers, deposits from suppliers and, in 2012 and 2011, received deposits in connection with a supply and license agreement with one of our joint ventures. See Note 6.

Revenue Recognition

Wafer and Other Product Sales

Revenue is recognized for wafer and other product sales when title transfers, the risks and rewards of ownership have been transferred to the customer, the fee is fixed or determinable and collection of the related receivable is reasonably assured, which is generally at the time of shipment for non-consignment orders. In the case of consignment orders, title passes when the customer pulls the product from the assigned storage facility or storage area or, if the customer does not pull the product within a contractually stated period of time (generally 60–90 days), at the end of that period, or when the customer otherwise agrees to take title to the product. Our wafers are generally made to customer specifications, and we conduct rigorous quality control and testing procedures to ensure that the finished wafers meet the customer’s specifications before the product is shipped. We consider international shipping term definitions in our determination of when title passes. We defer revenue for multiple element arrangements based on an average fair value per unit for the total arrangement when we receive cash in excess of fair value. We also defer revenue when pricing is not fixed or determinable or other revenue recognition criteria is not met.

In connection with certain of our long-term solar wafer supply agreements, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements.

Solar Energy System Sales

Solar energy system sales involving real estate

We recognize revenue for solar energy system sales with the concurrent sale or the concurrent lease of the underlying land, whether explicit or implicit in the transaction, in accordance with ASC 360-20, Real Estate Sales. For these transactions, we evaluate the solar energy system to determine whether the equipment is integral equipment to the real estate; therefore, the

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entire transaction is in substance the sale of real estate and subject to revenue recognition under ASC 360-20. A solar energy system is determined to be integral equipment when the cost to remove the equipment from its existing location, ship and reinstall at a new site, including any diminution in fair value, exceeds ten percent of the fair value of the equipment at the time of original installation. For those transactions subject to ASC 360-20, we recognize revenue and profit using the full accrual method once the sale is consummated, the buyer's initial and continuing investments are adequate to demonstrate its commitment to pay, our receivable is not subject to any future subordination, and we have transferred the usual risk and rewards of ownership to the buyer. If these criteria are met and we execute a sales agreement prior to the delivery of the solar energy system and have an original construction period of three months or longer, we recognize revenue and profit under the percentage of completion method of accounting applicable to real estate sales when we can reasonably estimate progress towards completion. During 2012 and 2011, we recognized $97.8 million and $54.3 million, respectively, of revenue using the percentage of completion method. Prior to 2011, we did not have sales that qualified for using the percentage of completion method.

If the criteria for recognition under the full accrual method are met except that the buyer's initial and continuing investment is less than the level determined to be adequate, then we will recognize revenue using the installment method. Under the installment method, we record revenue up to our costs incurred and apportion each cash receipt from the buyer between cost recovered and profit in the same ratio as total cost and total profit bear to the sales value. During 2012 and 2011, we recognized revenue of $22.7 million and $28.5 million, respectively, using the installment method. Prior to 2011, we did not have sales that qualified for using the installment method.

If we retain some continuing involvement with the solar energy system and do not transfer substantially all of the risks and rewards of ownership, profit shall be recognized by a method determined by the nature and extent of our continuing involvement, provided the other criteria for the full accrual method are met. In certain cases, we may provide our customers guarantees of system performance or uptime for a limited period of time and our exposure to loss is contractually limited based on the terms of the applicable agreement. In accordance with real estate sales accounting guidance, the profit recognized is reduced by our maximum exposure to loss (and not necessarily our most probable exposure), until such time that the exposure no longer exists.

Other forms of continuing involvement that do not transfer substantially all of the risks and rewards of ownership preclude revenue recognition under real estate accounting and require us to account for any cash payments using either the deposit or financing method. Such forms of continuing involvement may include contract default or breach remedies that provide SunEdison with the option or obligation to repurchase the solar energy system. Under the deposit method, cash payments received from customers are reported as deferred revenue for solar energy systems on the consolidated balance sheet, and under the financing method, cash payments received from customers are considered debt and reported as solar energy financing and capital lease obligations on the consolidated balance sheet.

Solar energy system sales not involving real estate

We recognize revenue for solar energy system sales without the concurrent sale or the concurrent lease of the underlying land at the time a sales arrangement with a third party is executed, delivery has occurred and we have determined that the sales price is fixed or determinable and collectible. For transactions that involve a construction period of three months or longer, we recognize the revenue in accordance with ASC 605-35, Construction-Type and Production-Type Contracts, using the percentage of completion method, measured by actual costs incurred for work completed to total estimated costs at completion for each transaction. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and travel costs. Marketing and administration costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are recognized in full during the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and revenue and are recognized in the period in which the revisions are determined. During the year ended December 31, 2012, we recorded $25.0 million of revenue under the percentage of completion method for solar energy sytems not involving real estate. There were no such amounts recognized in 2011 or 2010.

Solar energy system sales with service contracts

SunEdison frequently negotiates and executes solar energy system sales contracts and post-system-sale service contracts contemporaneously, which we combine and evaluate together as a single arrangement with multiple deliverables. The total arrangement consideration is first separated and allocated to post-system-sale separately priced extended warranty and maintenance service contracts, and the revenue associated with that deliverable is recognized on a straight-line basis over the contract term. The remaining consideration is allocated to each unit of accounting based on the respective relative selling prices, and revenue is recognized for each unit of accounting when the revenue recognition criteria have been met.

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Sale with a leaseback

We are a party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. We must determine the appropriate classification of the sale leaseback on a project-by-project basis because the terms of the solar energy systems lease schedule may differ from the terms applicable to other solar energy systems. In addition, we must determine if the solar energy system is considered integral equipment to the real estate upon which it resides. We do not recognize revenue on the sales transactions for any sales with a leaseback. Instead, revenue is recognized through the sale of electricity and energy credits which are generated as energy is produced. The terms of the lease and whether the system is considered integral to the real estate upon which it resides may result in either one of the following sale leaseback classifications:

Capital lease arrangements

Sale/capital leaseback classification for non-real estate transactions occurs when the terms of the lease schedule for a solar energy system result in a capital lease classification. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system. Under a capital lease, a capitalized leased asset and obligation is recorded at the present value of the minimum lease payments. Any gain on the sale is recorded as a reduction of the capitalized leased asset which is then recognized to cost of goods sold through reduced depreciation expense over the term of the lease. As of the SunEdison acquisition date of November 20, 2009 through December 31, 2012, there were no arrangements which resulted in this accounting.

Financing arrangements

The financing method is applicable when we have determined that the assets under the lease are real estate. This occurs due to either a transfer of land or the transfer of a lease involving real estate and the leased equipment is integral equipment to the real estate. A sale leaseback is classified as a financing sale leaseback if we have concluded the leased assets are real estate and we have a prohibited form of continuing involvement, such as an option or obligation to repurchase the assets under our master lease agreements.

Under a financing sale leaseback, we do not recognize any upfront profit because a sale is not recognized. The full amount of the financing proceeds is recorded as solar energy financing debt, which is typically secured by the solar energy system asset and its future cash flows from energy sales, but generally has no recourse to MEMC or SunEdison under the terms of the arrangement.

We use our incremental borrowing rate to determine the principal and interest component of each lease payment. However, to the extent that our incremental borrowing rate will result in either negative amortization of the financing obligation or a built-in loss at the end of the lease (e.g. net book value of the system asset exceeds the financing obligation), the rate is adjusted to eliminate such results. The interest rate is adjusted accordingly for the majority of our financing leasebacks because our future minimum lease payments do not typically exceed the initial proceeds received from the buyer-lessor. As a result, most of our lease payments are reported as interest expense, the principal of the financing debt does not amortize, and we expect to recognize a gain upon the final lease payment at the end of the lease term equal to the unamortized balance of the financing debt less the write-off of the system assets net book value.

Operations and maintenance

Operations and maintenance revenue is billed and recognized as services are performed. Costs of these revenues are expensed in the period they are incurred.

Solar energy service revenues, energy credits and incentives

For SunEdison-owned or capitalized solar energy systems in the U.S., we may receive incentives or subsidies from various state governmental jurisdictions in the form of renewable energy credits (“RECs”), which we sell to third parties. In the State of California, we may also receive performance-based incentives (“PBIs”) from public utilities in connection with a program sponsored by the State of California. The Solar Energy segment recorded total PBI revenue of $31.4 million, $24.3 million and $18.6 million for the years ended December 31, 2012, 2011 and 2010, respectively, and total REC revenue of $17.3 million, $15.1 million and $7.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. Both the RECs and PBIs are based on the actual level of output generated from the system. RECs are generated as our solar energy systems generate electricity. Typically, SunEdison enters into five to ten year binding contractual arrangements with utility companies or other investors who purchase RECs at fixed rates. REC revenue is recognized at the time SunEdison has transferred a REC pursuant to an executed contract relating to the sale of the RECs to a third party. For PBIs, production from SunEdison-operated systems is verified by an independent third party and, once verified, revenue is recognized based on the terms of the contract and the

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fulfillment of all revenue recognition criteria. There are no penalties in the event electricity is not produced for PBIs. However, if production does not occur on the systems for which we have sale contracts for our RECs, we may have to purchase RECs on the spot market or pay specified contractual damages. Historically, we have not had to purchase material amounts of RECs to fulfill our REC sales contracts.

Recording of a sale of RECs and receipt of PBIs under U.S. GAAP are accounted for under ASC 605, Revenue Recognition. There are no differences in the process and related revenue recognition between REC sales to utilities and non-utility customers. Revenue is recorded when all revenue recognition criteria are met, including: there is persuasive evidence an arrangement exists (typically through a contract), services have been rendered through the production of electricity, pricing is fixed and determinable under the contract and collectability is reasonably assured. For RECs, the revenue recognition criteria are met when the energy is produced and a REC is generated and transferred to a third party pursuant to a contract with that party fixing the price for the REC. For PBIs, revenue is recognized upon validation of the kilowatt hours produced from a third party metering company because the quantities to be billed to the utility are determined and agreed to at that time.

Derivative Financial Instruments and Hedging Activities

All derivative instruments are recorded on the consolidated balance sheet at fair value. Derivatives not designated as hedge accounting and used to hedge foreign-currency-denominated balance sheet items are reported directly in earnings along with offsetting transaction gains and losses on the items being hedged. Derivatives used to hedge foreign-currency denominated cash flows and floating rate debt may be accounted for as cash flow hedges, as deemed appropriate. Gains and losses on derivatives designated as cash flow hedges are recorded in other comprehensive (loss) income and reclassified to earnings in a manner that matches the timing of the earnings impact of the hedged transactions. The ineffective portion of all hedges, if any, is recognized currently in earnings. Derivatives used to manage the foreign currency exchange risk associated with a net investment denominated in another currency are accounted for as a net investment hedge. The effective portion of the hedge will be recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. When the investment is dissolved and MEMC recognizes a gain or loss in other income (expense), the associated hedge gain or loss in other comprehensive (loss) income will be reclassified to other income (expense).

Derivatives not designated as hedging

During 2006, we executed a long-term supply agreement with a customer, Suntech Power Holdings (“Suntech”). At the same time, we received a fully vested, non-forfeitable warrant to purchase common shares of Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The warrant becomes exercisable over a five year period (20% annually) beginning January 1, 2008 and has a five year exercise period from the date each tranche becomes exercisable. The estimated grant date fair value of the warrant was $66.6 million and was recorded to other assets with the offset to non-solar energy system deferred revenue – long-term on the consolidated balance sheet. The non-cash transaction was excluded from the consolidated statement of cash flows. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. We used a lattice model to determine the warrant’s fair value. The assumptions used in calculating the fair value of the warrant represented our best estimates, but these estimates involved inherent uncertainties and the application of our judgment.

We generally use currency forward contracts to manage foreign currency exchange risk relating to current trade receivables and payables with our foreign subsidiaries and current trade receivables and payables with our customers and vendors denominated in foreign currencies (primarily Japanese Yen and Euro). The purpose of our foreign currency forward contract activities is to protect us from the risk that the dollar net cash flows resulting from foreign currency transactions will be negatively affected by changes in exchange rates. We do not hold or issue financial instruments for speculative or trading purposes. Gains or losses on our forward contracts, as well as the offsetting losses or gains on the related hedged receivables and payables, are included in non-operating expense (income) in the consolidated statement of operations. Net currency losses on unhedged foreign currency positions totaled $6.6 million, $4.7 million and $0.5 million in 2012, 2011 and 2010, respectively.

Derivatives designated as hedging

In addition to the currency forward contracts purchased to hedge transactional currency risks, we may enter into currency forward contracts to hedge cash flow risks associated with future purchases of raw materials. Our cash flow hedges are designed to protect against the variability in foreign currency rates between a foreign currency and the U.S. Dollar. As of December 31, 2012, there were no currency forward contracts outstanding being accounted for as cash flow hedges.

We are party to four interest rate swap instruments, three of which are accounted for using hedge accounting. The interest rate swaps are used to manage risks generally associated with interest rate fluctuations. For those financial instruments that qualify for cash flow hedging in accordance with derivative instrument and hedging activities guidance, we have elected to use hedge

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accounting, whereby changes in the fair market value of the derivative instruments are reflected in the accompanying consolidated financial statements in other comprehensive (loss) income . The counterparties to these agreements are financial institutions. The fair values of the contracts are estimated by obtaining quotations from the financial institutions. The fair value is an estimate of the net amount that we would pay on December 31, 2012, if the agreements were transferred to other parties or cancelled by us.

Our previous joint venture with Q-Cells SE, which was not consolidated, was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract for 70.0 million Euros. The forward contract met all the criteria for hedge accounting and the derivative instrument was effective as an economic hedge of foreign exchange risk associated with the hedged net investment. The effective portion of the hedge was recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our consolidated statement of operations, as the remaining investment in Q-Cells SE and related forward contracts were liquidated in the fourth quarter of 2010. See Note 5 for further discussion.

Translation of Foreign Currencies

We determine the functional currency of each subsidiary based on a number of factors, including the predominant currency for the subsidiary’s sales and expenditures and the subsidiary’s borrowings. When a subsidiary’s local currency is considered its functional currency, we translate its financial statements to U.S. Dollars as follows:

• Assets and liabilities using exchange rates in effect at the balance sheet date; and

• Statement of operations accounts at average exchange rates for the period.

Adjustments from the translation process are presented in accumulated other comprehensive (loss) income in stockholders’ equity.

Income Taxes

Deferred income taxes arise because of a different tax basis of assets or liabilities between financial statement accounting and tax accounting, which are known as temporary differences. We record the tax effect of these temporary differences as deferred tax assets (generally items that can be used as a tax deduction or credit in future periods) and deferred tax liabilities (generally items for which we receive a tax deduction, but have not yet been recorded in the consolidated statement of operations). We regularly review our deferred tax assets for realizability, taking into consideration all available evidence, both positive and negative, including historical pre-tax and taxable income (losses), projected future pre-tax and taxable income (losses) and the expected timing of the reversals of existing temporary differences. In arriving at these judgments, the weight given to the potential effect of all positive and negative evidence is commensurate with the extent to which it can be objectively verified. Reportable U.S. GAAP income from SunEdison's financing sale-leaseback transactions in the U.S. is deferred until the end of the lease term, generally 20-25 years, through the non-cash extinguishment of the debt.  However, sale-leaseback transactions generate current U.S. taxable income at the time of the sale, with the timing differences increasing deferred tax assets.  As a result of the continued decline in solar market conditions, the restructuring charges announced in December 2011, and cumulative losses in the U.S. and certain foreign jurisdictions, we recorded a material non-cash valuation allowance against the deferred tax assets at December 31, 2011. See Note 14 for further discussion.

We believe our tax positions are in compliance with applicable tax laws and regulations. Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. Uncertain tax benefits, including accrued interest and penalties, are included as a component of other long-term liabilities because we do not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. The accrual of interest begins in the first reporting period that interest would begin to accrue under the applicable tax law. Penalties, when applicable, are accrued in the financial reporting period in which the uncertain tax position is taken on a tax return. We recognize interest and penalties related to uncertain tax positions in income tax expense, which is consistent with our historical policy. We believe that our income tax accrued liabilities, including related interest, are adequate in relation to the potential for additional tax assessments. There is a risk, however, that the amounts ultimately paid upon resolution of audits could be materially different from the amounts previously included in our income tax expense and, therefore, could have a material impact on our tax provision, net (loss) income and cash flows. We review our accrued liabilities quarterly, and we may adjust such liabilities due to proposed assessments by tax authorities, changes in facts and circumstances, issuance of new regulations or new case law, negotiations between tax authorities of different countries concerning our transfer prices between

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our subsidiaries, the resolution of entire audits, or the expiration of statutes of limitations. Adjustments are most likely to occur in the year during which major audits are closed.

Due to the restructuring announcement made in December 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future. We plan foreign remittance amounts based on projected cash flow needs as well as the working capital and long-term investment requirements of our foreign subsidiaries and our domestic operations.

We have made our best estimates of certain income tax amounts included in the financial statements. Application of our accounting policies and estimates, however, involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. In arriving at our estimates, factors we consider include how accurate the estimate or assumptions have been in the past, how much the estimate or assumptions have changed and how reasonably likely such change may have a material impact.

Stock-Based Compensation

Stock-based compensation expense for all share-based payment awards is based on the estimated grant-date fair value. We recognize these compensation costs net of an estimated forfeiture rate for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the option vesting term. For ratable awards, we recognize compensation costs for all grants on a straight-line basis over the requisite service period of the entire award. We estimate the forfeiture rate taking into consideration our historical experience during the preceding four fiscal years.

We routinely examine our assumptions used in estimating the fair value of employee options granted. As part of this assessment, we have determined that our historical stock price volatility and historical pattern of option exercises are appropriate indicators of expected volatility and expected term. The interest rate is determined based on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term of the award. We estimate the fair value of options using the Black-Scholes option-pricing model for our ratable and cliff vesting options. For our market condition awards, the grant date fair value was calculated for these awards using a probabilistic approach under a Monte Carlo simulation taking into consideration volatility, interest rates and expected term.

Contingencies

We are involved in conditions, situations or circumstances in the ordinary course of business with possible gain or loss contingencies that will ultimately be resolved when one or more future events occur or fail to occur. We continually evaluate uncertainties associated with loss contingencies and record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements; and (ii) the loss or range of loss can be reasonably estimated. Legal costs are expensed when incurred. Gain contingencies are not recorded until realized or realizable.

Shipping and Handling

Costs to ship products to customers are included in marketing and administration expense in the consolidated statement of operations. Amounts billed to customers, if any, to cover shipping and handling are included in net sales. Cost to ship products to customers were $24.6 million, $22.0 million and $20.7 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Fair Value Measurements

Fair value accounting guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, and are based on market data obtained from sources independent of MEMC. Unobservable inputs reflect assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

• Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that MEMC has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Because valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

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• Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Valuations for Level 2 are prepared on an individual instrument basis using data obtained from recent transactions for identical securities in inactive markets or pricing data from similar instruments in active and inactive markets.

• Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We maintain various financial instruments recorded at cost in the December 31, 2012 and 2011 balance sheets that are not required to be recorded at fair value. For these instruments, we used the following methods and assumptions to estimate the fair value:

• Cash equivalents, restricted cash, accounts receivable and payable, customer deposits, income taxes receivable and payable, short-term borrowings, and accrued liabilities—cost approximates fair value because of the short maturity period; and

• Long-term debt—fair value is based on the amount of future cash flows associated with each debt instrument discounted at our current estimated borrowing rate for similar debt instruments of comparable terms.

Redeemable Noncontrolling Interest

Redeemable noncontrolling interests are equity interests in common stock of consolidated subsidiaries that have redemption features that are not solely within our control. These interests are classified as temporary equity because their redemption is considered probable. These interests are measured at the greater of estimated redemption value at the end of each reporting period or the initial carrying amount of the redeemable noncontrolling interests adjusted for cumulative earnings allocations.  Adjustments to report redeemable noncontrolling interests at estimated redemption value are determined after the attribution of net income or loss of the subsidiary and are recorded to retained earnings, or in the absence of retained earnings, additional paid-in-capital.

Accounting Standards Updates

In February 2012, the FASB issued Accounting Standards Update No. 2012-2 - Intangibles Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, which amends FASB ASU 2011-08 and states that companies can use a qualitative approach to measuring Intangibles, Goodwill and Other rather than a quantitative approach. In addition, it is not required for an entity to disclose the quantitative information about significant unobservable inputs used in fair value measurements categorized within level 3 of the fair value hierarchy required by paragraph 820-10-50-2 that relate to the financial accounting and reporting for an indefinite-lived intangible asset after its initial recognition. We do not expect that the adoption of ASU Update No. 2012-2 will have a material impact on our consolidated financial statements.

In June 2011, the FASB issued Accounting Standards Update 2011-05 ("ASU 2011-05"), Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 allows an entity to present components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. This standard was adopted on January 1, 2012, and we have presented components of net income (loss) and other comprehensive income (loss) in one continuous statement for the quarter ended periods March 31, 2012, June 30, 2012 and September 30, 2012. For the year-ended December 31, 2012, comprehensive income (loss) is presented as a stand alone financial statement.

In October 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2009-13 (“ASU 2009-13”), which updates the current guidance pertaining to multiple-element revenue arrangements included in ASC Subtopic 605-25, Multiple-Element-Arrangements. The Company adopted this guidance on January 1, 2011.

Supplemental Cash Flow Information

Following is information related to interest and taxes paid as well as certain non-cash investing and financing activities including acquisition related items:

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	For the year ended December 31,
	2012		2011			2010
In millions
Supplemental disclosures of cash flow information:
Interest payments (including debt issuance costs), net of amounts capitalized	$	170.9	$	155.9		$	22.2
Income taxes paid (refunded), net	40.9		13.7			(9.4		)
Supplemental schedule of non-cash investing and financing activities:
Accounts payable incurred (relieved) for acquisition of fixed assets, including solar energy systems	$	49.7	$	(68.0	)	$	138.7
Debt transferred to and assumed by buyer upon sale of solar energy systems	403.1		104.6			43.3
Conversion of note payable to equity	—		—			27.0
Acquisitions:
Fair value of assets acquired	$	—	$	334.5		$	65.2
Goodwill	—		97.8			56.4
Liabilities assumed and noncontrolling interests	—		(158.0		)	(19.9		)
Loans prior to acquisition	—		(16.0		)	(26.0		)
Other non-cash consideration	—		(90.7		)	—
Less: cash acquired	—		(3.6		)	(2.2		)
Cash paid, net of cash acquired	$	—	$	164.0		$	73.5

3. RESTRUCTURING, IMPAIRMENT AND OTHER CHARGES

2011 Global Plan

During the second half of 2011, the semiconductor and solar industries experienced downturns, and the downturn in the solar industry was more dramatic. In December 2011, in order to better align our business to current and expected market conditions in the semiconductor and solar markets, as well as to improve the company's overall cost competitiveness and cash flows across all segments, we committed to a series of actions to reduce the company's global workforce, right size production capacity and accelerate operating cost reductions in 2012 and beyond (the “2011 Global Plan”).  These actions included:

• Reducing total workforce by approximately 1,400 persons worldwide, representing approximately 20% of the company's employees; 

• Shuttering the company's Merano, Italy polysilicon facility as of December 31, 2011;

• Reducing production capacity at the company's Portland, Oregon crystal facility and slowing the ramp of the Kuching, Malaysia wafering facility; and

• Consolidating our solar wafering and solar energy system operations into a single Solar Energy business unit, effective January 1, 2012.

In addition, based on the market capitalization of MEMC compared to book value and the adverse market conditions, we incurred charges associated with restructuring, impairment of long-lived assets, impairments of goodwill and certain investments, and write-downs of inventory and the realizability of deferred tax assets. The following is a summary of the charges recorded during the three months ended December 31, 2011:

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In millions	Segment
Type of Charge	Semiconductor Materials		Solar Energy		Corporate		Total		Statement of Operations Classification
Restructuring	$	35.6	$	303.0	$	0.9	$	339.5	Restructuring
Long-lived asset impairment (See Note 9)	7.4		358.0		—		365.4		Long-lived asset impairment
Goodwill impairment (See Note 10)	—		384.1		—		384.1		Goodwill impairment
Investment/JV impairment (See Note 6)	—		78.9		—		78.9		Other, net and equity in loss of joint ventures
Inventory adjustments and other (See Note 7)	14.2		82.5		—		96.7		Cost of goods sold

In the fourth quarter of 2011, restructuring charges consisted of $62.1 million of severance and other one-time benefits for employees terminated under the 2011 Global Plan, $226.4 million of estimated liabilities accrued as a result of us canceling or not being able to fulfill the entire purchase obligation for certain supplier contracts, and $51.0 million of other related charges. Total cash payments made under the 2011 Global Plan during the year ended December 31, 2011 were $1.8 million. See table below for cash payments made during the year ended December 31, 2012. For additional discussion on the charges associated with the impairment of long-lived assets, impairments of goodwill and certain investments, and write-downs of inventory and the realizability of deferred tax assets, see the respective footnotes noted in the above table.

In addition, during June 2011, we committed to actions to reduce overall manufacturing costs across our global sites, as well as to realign certain general and administrative expenses due to industry and customer specific developments. These actions included relocation of certain operations and reductions in headcount. During the year ended December 31, 2011, we recorded restructuring charges of $6.8 million for severance and other related employee benefits associated with these actions. Cash payments of $9.9 million were made during 2011 that were also related to these actions.

Details of the 2012 expenses, cash payments and expected costs incurred related to the 2011 Global Plan are set out in the following table:

														As of December 31, 2012
In millions	Accrued January 1, 2012		Year-to-date Restructuring Charges (Reversals)			Cash Payments			Currency			Accrued December 31, 2012		Cumulative Costs Incurred		Total Costs Expected to be Incurred
2011 Global Plan
Severance and Employee Benefits	$	60.2	$	—		$	(27.8	)	$	(0.7	)	$	31.7	$	63.2	$	63.2
Contract Termination	260.0		(93.4		)	(34.3		)	2.2			134.5		164.6		164.6
Other	51.1		(2.1		)	(11.9		)	1.2			38.3		49.7		49.7
Total	$	371.3	$	(95.5	)	$	(74.0	)	$	2.7		$	204.5	$	277.5	$	277.5

On September 4, 2012, we executed two settlement agreements with Evonik Industries AG and Evonik Degussa SpA ("Evonik"), one of our suppliers, to settle disputes arising from our early termination of two take-or-pay supply agreements. One of the original supply agreements also included a provision for the construction and operation of a chlorosilanes plant located on our existing Merano, Italy site for our benefit. Pursuant to the settlement, we will pay Evonik a total of 70.0 million euro, of which 10.0 million euro was paid in the third quarter of 2012 and 15.0 million euro was paid in the fourth quarter of 2012. The balance will be paid in various installments over the next three quarters. The settlement also required our forfeiture of a $10.2 million deposit with Evonik. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrual was made in the third quarter of 2012 resulting in $69.2 million of income within restructuring and impairment on the consolidated statement of operations. Additionally, on December 30, 2012 as part of the settlement with Evonik, we obtained title to the related chlorosilanes plant, which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

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2009 Restructuring Plan

In order to better align manufacturing capabilities to projected demand, MEMC committed to workforce reductions during the first and second quarters of 2009 (the “2009 Global Plan”) related to the Semiconductor Materials segment. In September 2009, MEMC committed to actions to reduce manufacturing costs in the Semiconductor Materials segment by shifting manufacturing from our St. Peters, Missouri and Sherman, Texas facilities to other locations which are closer to a number of MEMC’s customers in the Asia Pacific region (the “2009 U.S. Plan”). MEMC has provided and paid severance benefits to those terminated under the 2009 Global Plan and will provide severance benefits to those employees who have been or will be terminated under the 2009 U.S. Plan. The 2009 Global Plan was completed by June 30, 2009. We expect the 2009 U.S. Plan to be completed in 2013.

Details of 2012 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2012		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2012		As of December 31, 2012
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	12.6	$	(2.5	)	$	(7.4	)	$	2.7	$	15.5	$	15.5
Asset move costs	—		—			—			—		4.9		5.2
Contract termination	2.9		—			(2.9		)	—		2.9		2.9
Infrastructure costs	—		4.3			(4.3		)	—		4.3		4.3
Total	$	15.5	$	1.8		$	(14.6	)	$	2.7	$	27.6	$	27.9

Details of 2011 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2011		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2011		As of December 31, 2011
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	16.2	$	(0.2	)	$	(3.4	)	$	12.6	$	18.0	$	18.8
Asset move costs	—		1.7			(1.7		)	—		4.9		20.3
Contract termination	—		2.9			—			2.9		2.9		2.9
Infrastructure costs	—		—			—			—		—		4.0
Total	$	16.2	$	4.4		$	(5.1	)	$	15.5	$	25.8	$	46.0

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Details of 2010 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2010		Year-to-Date Restructuring Charges		Cash Payments			Accrued December 31, 2010		As of December 31, 2010
										Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	15.2	$	2.1	$	(1.1	)	$	16.2	$	18.2	$	21.0
Asset move costs	—		3.2		(3.2		)	—		3.2		20.3
Contract termination	—		—		—			—		—		3.0
Infrastructure costs	—		—		—			—		—		4.0
Total	$	15.2	$	5.3	$	(4.3	)	$	16.2	$	21.4	$	48.3

4. Acquisitions

On September 2, 2011, we completed the acquisition of 100% of the voting shares of Fotowatio Renewable Ventures, Inc. (“FRV U.S."), a developer of solar power projects in the U.S. The FRV U.S. acquisition expanded our pipeline of solar power projects and supports our expansion in the U.S. utility-scale power market. The purchase price was $187.8 million, including estimated contingent consideration fair valued at $54.2 million. The estimated acquisition date fair value of the contingent consideration reflected a discount at a credit adjusted interest rate for the period of the contingency. That measure was based on significant inputs that were not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions included (i) a discount percentage and (ii) a probability adjustment related to the operational metrics being met. On July 6, 2012, contingent consideration related to the acquisition of FRV U.S. was paid in full in the amount of $66.4 million. The difference between the initial estimate of the contingent consideration and the amount ultimately paid was recorded as an expense in the consolidated statement of operations.

The table below represents the allocation of the total consideration of tangible and intangible assets acquired and liabilities assumed from FRV U.S. based on an estimate of the fair value at the acquisition date:

In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	1.8
Solar energy systems held for development	64.2
Other current assets	9.0
Property, plant and equipment, net	23.0
Goodwill	44.6
Intangible assets	115.5
Other noncurrent assets	50.2
Current liabilities	(3.4		)
Short-term debt	(32.9		)
Other long-term liabilities	(44.6		)
Noncontrolling interests	(39.6		)
Total purchase price	$	187.8

At the date of acquisition, FRV U.S. had net operating losses that we expect will be realizable on MEMC's consolidated U.S. tax return, subject to annual Internal Revenue Code Section 382 limitations. Deferred tax assets attributable to these FRV U.S. net operating loss carry forwards of $9.3 million are included in other noncurrent assets in the table above. All of the goodwill

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was assigned to the Solar Energy segment and no goodwill was deductible for U.S. income tax purposes. The primary factors which resulted in recognition of goodwill included the assembled workforce and synergies in skill sets and operations. The amount of FRV U.S. revenue and operating loss included in the consolidated statement of operations for the year ended December 31, 2011 was $121.2 million and $48.3 million, respectively. The 2011 operating loss included a $44.6 million impairment of FRV U.S. goodwill during the three months ended December 31, 2011. See Note 10. We have not provided proforma financial information because the acquisition was not considered significant.

Other 2011 acquisitions

During the second quarter of 2011, SunEdison completed the acquisition of 100% of the voting equity of a company for a purchase price of $72.6 million, of which an estimated $27.0 million related to contingent consideration payable in cash. In the fourth quarter of 2012, contingent consideration related to this acquisition was paid in the amount of $13.6 million and the remainder is expected to be paid in 2013. This acquisition, which included project pipeline, is intended to further develop our solar energy systems' business and leverage the synergies in our Solar Energy segment. We recorded $43.8 million to goodwill, approximately $24.4 million of which is not deductible for tax purposes, and $13.0 million to intangible assets. All $43.8 million of goodwill was allocated to the Solar Energy segment and was subsequently written-off during the three months ended December 31, 2011. See Note 10. We have not provided proforma financial information because the acquisition was not considered significant.

During 2011, SunEdison completed two other acquisitions of 100% of the voting equity of these companies for a combined total purchase price of $14.3 million, of which $6.5 million relates to contingent consideration. We recorded $9.4 million and $4.8 million to goodwill and acquired intangible assets, respectively. The goodwill is not deductible for tax purposes for either of these acquisitions and was subsequently written-off during the three months ended December 31, 2011. See Note 10.

On July 1, 2010, we completed the acquisition of 100% of the voting equity of Solaicx, which became a wholly owned subsidiary of MEMC. The U.S. GAAP purchase price for Solaicx was $101.7 million, including cash and additional contingent consideration. The contingent consideration consists of cash and MEMC common stock, as elected by certain Solaicx shareholders.

The purchase price was calculated as follows:

In Millions
Cash	$	75.7
Contingent consideration	26.0
Total purchase price including estimated contingent consideration	$	101.7

Approximately $2.0 million of the cash consideration is currently held in escrow pursuant to the terms of the merger agreement and was reflected in goodwill. The contingent consideration was to be paid to the former Solaicx shareholders if certain operational criteria were met from July 1, 2010 through December 31, 2011. The amount payable is based on Solaicx achieving revenues of at least $60.0 million during such time period, up to a maximum revenue target of $71.8 million, with the payout on a linear basis between those two amounts. This would entitle the former Solaicx shareholders to up to an additional $27.6 million of a combination of cash and MEMC common stock. MEMC estimated the acquisition date fair value of the contingent consideration at $26.0 million, which reflects a discount at a credit adjusted interest rate for the period of the contingency. That measure was based on significant inputs that are not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions included (i) a discount percentage and (ii) a probability adjusted level of revenue expected to be achieved by Solaicx during the period between July 1, 2010 and December 31, 2011. Since the date of the acquisition, the revenue targets have not been met and we have reduced the estimated liability associated with the contingent consideration based on our revised estimates. This reduction was recognized in the statement of operations. The former Solaicx shareholders are disputing the Company's determination that the revenue targets were not met and the matter is subject to a binding arbitration proceeding.

The primary factor which resulted in recognition of goodwill, as well as our primary reason for the acquisition of Solaicx, was that the acquisition would allow us to produce high efficiency monocrystalline solar wafers at competitive costs. All of the goodwill was assigned to the Solar Energy segment and no goodwill is deductible for U.S. income tax purposes. See Note 10 regarding discussion of the subsequent impairment of all of this goodwill.

The table below represents the allocation of the total consideration to tangible and intangible assets acquired and liabilities assumed from Solaicx based on an estimate of the fair value at the acquisition date:

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In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	2.2
Other current assets	11.6
Property, plant and equipment, net	30.0
Goodwill	56.4
Intangible assets	21.0
Other noncurrent assets	0.4
Current liabilities	(12.2		)
Long-term debt and capital lease obligations, excluding current portion	(1.3		)
Other long-term liabilities	(6.4		)
Total purchase price	$	101.7

Acquisition related costs of $1.9 million were included in marketing and administration expense, and the amount of Solaicx’s loss of $11.2 million from the date of acquisition was included in the consolidated statement of operations for the year ended December 31, 2010 and was dilutive to earnings per share. The amount of Solaicx’s revenue included in the consolidated statement of operations for the same period was not material. See a description of intangible assets in Note 10.

Upon acquisition, Solaicx had net operating losses that would be realizable on MEMC’s consolidated U.S. tax return, subject to annual Internal Revenue Code Section 382 limitations. At December 31, 2012, we had deferred tax assets attributable to these Solaicx net operating loss carry forwards of $26.1 million and a corresponding valuation allowance of $26.1 million, reducing the net deferred tax asset for net operating losses to zero.

5. DERIVATIVES AND HEDGING INSTRUMENTS

MEMC’s hedging activities consist of:

		Assets (Liabilities or Equity) Fair Value
In millions	Balance Sheet Location	As of December 31, 2012			As of December 31, 2011
Derivatives designated as hedging:
Interest rate swaps	Accrued liabilities	$	(5.0	)	$	(4.5	)
Interest rate swaps	Accumulated other comprehensive income	$	4.3		$	3.9
Derivatives not designated as hedging:
Suntech warrant	Other assets	$	0.2		$	0.4
Currency forward contracts	Prepaid and other current assets	$	0.5		$	3.0
Currency forward contracts	Accrued liabilities	$	(7.1	)	$	(1.8	)
Interest rate swaps	Accrued liabilities	$	—		$	(1.1	)
		Losses (Gain)
In millions	Statement of Operations Location	Year Ended December 31, 2012			Year Ended December 31, 2011			Year Ended December 31, 2010
Derivatives designated as hedging:
Net investment hedge	Other, net	$	—		$	—		$	(17.3	)
Derivatives not designated as hedging:
Suntech warrant	Decline in fair value of warrant	$	0.2		$	4.8		$	14.0
Currency forward contracts	Other, net	$	9.0		$	7.4		$	1.3

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To mitigate financial market risks of fluctuations in foreign currency exchange rates, we utilize currency forward contracts. We do not use derivative financial instruments for speculative or trading purposes. We generally hedge transactional currency risks with currency forward contracts. Gains and losses on these foreign currency exposures are generally offset by corresponding losses and gains on the related hedging instruments, reducing the net exposure to MEMC. A substantial portion of our revenue and capital spending is transacted in the U.S. Dollar. However, we do enter into transactions in other currencies, primarily the Euro, the Japanese Yen, Canadian dollar and certain other Asian currencies. To protect against reductions in value and volatility of future cash flows caused by changes in foreign exchange rates, we have established transaction-based hedging programs. Our hedging programs reduce, but do not always eliminate, the impact of foreign currency exchange rate movements. At any point in time, we may have outstanding contracts with several major financial institutions for these hedging transactions. Our maximum credit risk loss with these institutions is limited to any gain on our outstanding contracts. As of December 31, 2012 and December 31, 2011, these currency forward contracts had net notional amounts of $320.5 million and $293.2 million, respectively.

In addition to the currency forward contracts purchased to hedge transactional currency risks, we entered into currency forward contracts during 2010 to hedge cash flow risks associated with future purchases of raw materials denominated in Euros. These forward contracts were established as cash flow hedges designed to protect against the variability in foreign currency rates between the Euro and U.S. Dollar. The cash flow hedges were accounted for using hedge accounting. As of June 30, 2011, the future purchases of raw materials associated with these cash flow hedges were no longer deemed probable and accordingly, the related gains of $14.2 million on the forward contracts were reclassified from accumulated other comprehensive (loss) income into earnings. During the 2011 third quarter, these forward contracts were liquidated, resulting in a loss of $6.6 million. There were no outstanding currency forward contracts designated as cash flow hedges as of December 31, 2012 and 2011.

We are party to three interest rate swap instruments that are accounted for using hedge accounting. These instruments are used to hedge floating rate debt and are accounted for as cash flow hedges. Under the swap agreements, we pay the fixed rate and the financial institution counterparties to the agreements pay MEMC a floating interest rate as indicated in the table below. The amount recorded in the consolidated balance sheet as provided in the table below represents the estimated fair value of the net amount that we would settle on December 31, 2012, if the agreements were transferred to other third parties or cancelled by us. The effective portion of these hedges for the year ended December 31, 2012 and 2011 were losses of $5.0 million and $4.5 million, respectively, and a gain of $5.3 million for the year ended December 31, 2010, which were recorded to other comprehensive (loss) income. There was no material ineffectiveness for the years ended December 31, 2012, December 31, 2011, and December 31, 2010, respectively.

As of December 31, 2012, we have one interest rate swap instrument that is used as an economic hedge. This instrument is used to hedge floating rate debt and is not accounted for as a cash flow hedge. Under the swap agreement, we pay the fixed rate and the financial institution counterparty to the agreement pays us a floating interest rate based on the table below. The amount recorded in the consolidated balance sheet as provided in the table below represents the estimated fair value of the net amount that we would settle on December 31, 2012 if the agreements were transferred to other third parties or cancelled by us. Because this hedge is deemed an economic hedge and not accounted for under hedge accounting, the changes in fair value are recorded to non-operating expense (income) within the consolidated statement of operations. The fair value of these hedges as of December 31, 2011 was a liability of $1.1 million. No such hedges existed prior to 2011.

A summary of all interest rate swap instruments as of December 31, 2012 are as follows:

	Notional Amount (in millions)	Fixed Rate	Variable Rate	Termination Date	Assets (Liabilities) Fair Value at December 31, 2012
					Dollars in millions
Interest rate swap #1 cash flow hedge	4.4 Euros	5.1%	Euribor plus 1.5%	6/30/2023	$	(1.7	)
Interest rate swap #2 cash flow hedge	1.8 Euros	5.1%	Euribor plus 1.5%	6/30/2023	(0.7		)
Interest rate swap #3 cash flow hedge	32.4 Canadian Dollars	3.3%	Canadian Deposit Offering Rate	6/5/2028	(2.6		)
Interest rate swap #4 economic hedge	11.5 South African Rand	5.25%	ZAR-JIBAR-SAFEX Rate	3/31/2024	—
					$	(5.0	)

We previously had an unconsolidated joint venture, Q-Cells SE, which was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract, accounted for as a net investment hedge, for 70.0 million Euros. We received 63.5 million Euros

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(approximately $77 million) of our investment in the second quarter of 2010 and at the same time reduced our net investment hedge to the remaining equity investment balance. During the fourth quarter of 2010, we received the remaining balance of our investment of 5.8 million Euros (approximately $8 million). During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our statement of operations. No ineffectiveness was recognized in 2012, 2011 or 2010.

The Suntech warrant consists of a fully vested, non-forfeitable warrant to purchase common shares of Suntech which was received in 2006 at the time that we signed a long-term supply agreement with Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The Suntech warrant exposes us to equity price risk.

6. INVESTMENTS

The carrying value of short-term and long-term investments consists of the following:

	As of December 31,
	2012		2011
In millions
Equity method investments	$	23.3	$	25.8
Equity investments at cost	12.9		12.5
Items measured at fair value on a recurring basis	13.4		16.2
Time deposits	0.3		0.3
Total investments	49.9		54.8
Less: short-term investments	0.3		0.3
Non-current investments	$	49.6	$	54.5

Equity Method Investments

We have made equity method investments, which are primarily joint ventures, totaling $43.4 million during the year ended December 31, 2012. The accounting for the investments is described below. Generally, these investments are designed to create additional capacity in our Solar Energy segment. Our aggregate remaining contractual investment commitments to our joint ventures as of December 31, 2012 is up to an additional $117.7 million. The contracts governing these joint ventures generally do not have any specific time frames for these future investments, however, we expect to fund approximately $105.0 million of these commitments in 2013.

Due to adverse solar market conditions and expected future reduced sales volumes, our equity method joint venture, Jiangsu Meike Silicon Energy Co. LTD., ("Meike" and formerly the Zhenjiang Huantai joint venture), recorded an impairment charge related to the joint venture's long-lived assets in the fourth quarter of 2011. In addition, in the fourth quarter of 2011 we determined that a loss in value in another equity method investment occurred and was other than temporary. We recorded impairment charges totaling $67.3 million on our equity method investments in 2011. During the year ended December 31, 2012, no equity method investment impairments were recorded.

Samsung Fine Chemicals Joint Venture

In February 2011, we entered into an equity method joint venture with Samsung Fine Chemicals Co. Ltd. (the "SMP JV") for the construction and operation of a new facility to produce high purity polysilicon in Ulsan, South Korea. The SMP JV will manufacture and supply polysilicon to us and to international markets. MEMC Singapore Pte. Ltd.'s. ownership interest in the joint venture is 50% and Samsung Fine Chemicals Co. Ltd. owns the other 50%.

In September 2011, we executed a Supply and License Agreement with the SMP JV under which MEMC will license and sell to the joint venture certain technology and related equipment used for producing polysilicon. We will receive proceeds under the Supply and License Agreement based on certain milestones being achieved throughout the construction, installation and testing of the equipment, which is expected to occur primarily over the next 12 months. Proceeds received from the SMP JV under the Supply and License Agreement will be recorded as a reduction in our basis in the SMP JV investment and to the extent that our basis in the investment is zero, the remaining proceeds received will be recorded as a long-term liability. To the extent the total cash proceeds received exceed the sum of our cost basis in the equipment plus our capital contributions to the SMP JV and when we have no remaining performance obligations, a net gain would be recognized on the transaction.

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During the year ended December 31, 2012, under the Supply and License Agreement we made total equity contributions of $43.4 million. Since inception of the SMP JV, the proceeds received have exceeded our investment, and we recorded this as a reduction in our equity investment balance with the excess of $30.5 million recorded in long-term customer and other deposits. The cash received is recorded as an investing inflow within the consolidated statement of cash flows. As of December 31, 2012, and December 31, 2011 our investment balance in the SMP JV was $0. Our total cash commitments, inclusive of the $57.3 million invested thus far, are expected to be approximately $175.0 million through 2014. We expect our remaining cash commitments to be substantially offset by proceeds received under the Supply and License Agreement.

Equity Investments at Cost

During the years ended December 31, 2012 and 2011, we recorded an other-than-temporary impairment charge of $3.6 million and $11.6 million, respectively, associated with one of our cost method investments. The impairment was a result of the length and severity of a fair value decline below our cost basis, with no turnaround in the foreseeable future. We have assessed and determined that there have been no other events or circumstances that had a material adverse effect on our other cost method investments during this period. No similar charges were recorded in 2010.

Investments Recorded at Fair Value

At December 31, 2012, we held an investment in equity securities of a customer’s common stock, Gintech Energy Corporation ("Gintech"), acquired in connection with the execution of a long-term supply agreement. This investment is accounted for at fair value, is classified as a long-term available-for-sale investment and has a cost basis of $12.4 million.

7. INVENTORIES

Inventories consist of the following:

	As of December 31,
	2012		2011
In millions
Raw materials and supplies	$	89.1	$	121.6
Goods and work-in-process	109.1		97.7
Finished goods	49.6		102.5
Total inventories	$	247.8	$	321.8

In connection with our 2011 Global Plan, we have realigned our operations such that we are primarily manufacturing solar wafers and sourcing solar cells and modules for internal consumption by SunEdison. As a result, effective January 1, 2012, all solar wafer, cell and module inventory is classified as goods and work in process. Finished goods inventory at December 31, 2011 in the above table includes $42.8 million of solar wafer inventory classified as finished goods.

SunEdison inventories of $27.3 million at December 31, 2012 and $58.4 million at December 31, 2011 consist of raw materials and supplies not allocated to a solar energy system. Included in the table above at December 31, 2012, we had $27.7 million of finished goods inventory held on consignment, compared to $28.5 million at December 31, 2011.

During the year ended December 31, 2012, we recorded lower of cost or market charges totaling $3.4 million to work in process and raw materials inventory, primarily related to adverse solar market pricing conditions.

Due to adverse solar market conditions and related price decreases, which led to the reduction of solar wafer production at our Kuching, Malaysia and Portland, Oregon plants and the shuttering of our Merano, Italy plant, we recorded lower of cost or market charges on our raw materials and supplies inventory of $53.7 million, in the year ended December 31, 2011. No such charges were recorded in the year ended December 31, 2010. In addition to the raw materials and supplies inventory charges, we recorded charges of approximately $30.2 million, and $0.4 million, respectively, for goods and work-in-process in the years ended December 31, 2011 and December 31, 2010. Further, we recorded charges for finished goods inventory primarily related to the adverse solar market conditions which led to underutilization of our Kuching solar wafering plant in the amount of $29.7 million and $2.1 million, respectively, for the years ended December 31, 2011 and December 31, 2010.

Due to the earthquake in Japan on March 11, 2011, wafer production in our semiconductor wafer plant in Japan was suspended from that time through April 12, 2011. Due to the unplanned downtime, we recorded a total of $14.9 million of adjustments

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during the year ended December 31, 2011 as period charges to cost of goods sold for the under absorption of production costs. We recorded no similar adjustments for the years ended December 31, 2012 and December 31, 2010.

8. SOLAR ENERGY SYSTEMS HELD FOR DEVELOPMENT AND SALE

Solar energy systems held for development and sale consist of the following:

	As of December 31,
	2012		2011
In millions
Under development	$	133.8	$	193.5
Systems held for sale	—		179.5
Total solar energy systems held for development and sale	$	133.8	$	373.0

9. PROPERTY, PLANT AND EQUIPMENT (INCLUDING CONSOLIDATED VIEs)

Property, plant and equipment consists of the following:

	As of December 31,
	2012			2011
In millions
Land	$	6.1		$	6.5
Software	31.1			31.2
Buildings and improvements	320.5			404.7
Machinery and equipment	1,605.5			1,470.6
Solar energy systems	1,306.5			896.2
	3,269.7			2,809.2
Less accumulated depreciation	(964.1		)	(851.8		)
	2,305.6			1,957.4
Construction in progress – non solar energy systems	141.4			155.5
Construction in progress – solar energy systems	226.0			280.2
Total property, plant and equipment, net	$	2,673.0		$	2,393.1

We recorded asset impairment charges of $20.0 million for the year ended December 31, 2012, primarily related to solar wafer machinery and equipment. These charges are reflected in the long-lived asset impairment charges in our consolidated statement of operations. We obtained title to a chlorosilanes plant as part of the settlement with Evonik, which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

Due to the downturn in solar market conditions, we performed an asset impairment analysis of the polysilicon production assets at our shuttered Merano, Italy facility, as well as solar wafering assets at our Portland, Oregon, Kuching, Malaysia and St. Peters, Missouri facilities in the fourth quarter of 2011. As a result of this analysis, we recognized asset impairment charges of $354.7 million during the year ended December 31, 2011, which were recorded in the long-lived asset impairment charges in our consolidated statement of operations. No similar charges were recorded during the year ended December 31, 2010.

The polysilicon manufacturing assets at our shuttered Merano, Italy facility were impaired at December 31, 2011 and written down to their net realizable salvage value, which was based primarily on an appraisal. For our solar wafering assets, we estimated the fair value of the asset group using discounted expected cash flows and recorded an impairment charge during 2011 because the net carrying value of the asset group exceeded its fair value. The value of these assets deteriorated because of the significant market price declines and we ceased or scaled back manufacturing operations due to changes in future service potential. We developed our expected cash flows based on assumptions that were consistent with our then current and forecast operating plans, which are considered Level 3 inputs in the fair value hierarchy. Cash flows cover a time period that coincides with the estimated remaining useful life of the primary assets and a probability factor was assigned to each cash flow scenario to derive the expected present value based on a risk-free discount rate.

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10. GOODWILL AND INTANGIBLE ASSETS

The carrying values of intangible assets at December 31, 2012 and December 31, 2011 are as follows:

		December 31, 2012							December 31, 2011
Dollars in millions	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount		Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount
Amortizable intangible assets:
Favorable energy credits	7	$	14.2	$	(9.0	)	$	5.2	$	14.2	$	(6.1	)	$	8.1
Customer relationships(1)	6	5.7		(2.4		)	3.3		5.7		(1.6		)	4.1
Trade name	15	4.1		(0.9		)	3.2		4.1		(0.6		)	3.5
Internally developed software	4	1.3		(1.3		)	—		1.7		(1.0		)	0.7
Developed technology(1)	5	12.0		(6.0		)	6.0		13.9		(5.5		)	8.4
Non-compete agreement	1	1.2		(1.2		)	—		1.2		(0.4		)	0.8
Total amortizable intangible assets		$	38.5	$	(20.8	)	$	17.7	$	40.8	$	(15.2	)	$	25.6
Indefinite lived assets:
In-process technology(1)	Indefinite	$	0.9	$	—		$	0.9	$	1.5	$	—		$	1.5
Power plant development arrangements(2)	Indefinite	143.3		(47.7		)	95.6		143.3		(21.2		)	122.1
Total indefinite lived assets		$	144.2	$	(47.7	)	$	96.5	$	144.8	$	(21.2	)	$	123.6

____________________ 

⁽¹⁾  These intangibles represent the amounts acquired in the SunEdison, Solaicx and other acquisitions. The useful life for in-process technology will be determined once the research and development process is complete and, at that time, amortization of the asset will begin.

⁽²⁾  Power plant development arrangements are allocated to the solar energy system (property, plant and equipment or inventory) upon completion of the related solar energy systems stemming from the backlog at the date of acquisition. Depending on the classification of the system, held for development and sale or property, plant and equipment will determine whether the intangible is amortized to cost of goods sold or to depreciation expense. Includes $82.6 million, net of amortization, acquired in the FRV U.S. acquisition.

In 2012, 2011 and 2010, we recognized amortization expense of $34.6 million, $9.4 million and $5.9 million, respectively. We incurred impairment charges of $1.2 million and $6.6 million, primarily on our developed technology intangible assets, for the years ended December 31, 2012 and 2011, respectively. No similar charges were recorded in 2010.

We expect to recognize annual expense on our amortizable intangible assets as follows:

	2013		2014		2015		2016		2017
In millions
Amortization	$	6.9	$	4.4	$	1.7	$	1.2	$	0.5

Goodwill Impairments

In 2011, the entire carrying amount of Goodwill was impaired and was recorded to goodwill impairment charges in the consolidated statement of operations.

During 2011, the Solar Energy segment included the Solar Materials reporting unit and the former Solar Energy reporting unit, both of which carried a goodwill balance. We perform our annual goodwill impairment test on December 1 of each year, however, due to deteriorating economic conditions in the solar industry, we performed an interim impairment analysis in the quarter ended September 30, 2011. During the interim period ended September 30, 2011, we evaluated whether impairment indicators existed which would require a detailed test of goodwill for impairment as of an interim date. As of September 30, 2011, our net book value was significantly above the market capitalization of our common stock. During June 2011 and continuing through September 2011, we observed a strong correlation between the decline in our market capitalization and the decline in pricing in the solar wafer market, caused by an overall softening of demand in the solar materials supply chain. We evaluated the following items, among others, in determining whether there were impairment indicators requiring an evaluation of goodwill impairment as of an interim date: the impact of solar wafer price declines on our Solar Materials reporting unit and on our raw material costs for our Solar Energy reporting unit; advanced materials technologies at our Solar Materials reporting unit; the financial performance of each reporting unit in fiscal year 2011 to date; and our internal forecast data. We determined

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that there were indicators of potential impairment due to the items previously mentioned and the sustained decline in our common stock price resulting in a market capitalization below book value. Based on the above, we determined that there was a triggering event, which required us to perform a Step 1 goodwill impairment analysis for the interim period ended September 30, 2011 on both the Solar Materials and Solar Energy reporting units' goodwill.

We prepared a discounted cash flow (“DCF”) model for each of the reporting units to assess the recoverability of the goodwill using significant unobservable inputs (Level 3), which we then reconciled to our average market capitalization over a reasonable period of time, which included a control premium supported by recent transactions, as of September 30, 2011. For our DCF models, we used inputs we believed a market participant would use, including earnings projections and other cash flow assumptions over future periods plus a terminal value assuming a long-term growth rate. We believe the DCF model represents a reliable valuation method for this purpose because it reflects the information a market participant would likely use to value each of the reporting units.

Solar Materials reporting unit

In performing this test for our Solar Materials reporting unit, we made a downward revision in the forecasted cash flows as a result of a decrease in the market price for silicon products and weaker demand for solar products. Our analysis also included considerations of our market capitalization. Based on the results of our analysis in which we estimated the fair value of the goodwill as of September 30, 2011, we concluded that the carrying value of goodwill exceeded its fair value and, as a result, recorded an impairment charge totaling $56.4 million during the quarter ended September 30, 2011. This impairment charge was entirely associated with our Solaicx acquisition completed in July 2010 and represented the full carrying value of the goodwill related to the Solar Materials reporting unit.

Solar Energy reporting unit

Based on the impairment test performed during the interim period, it was determined that there was no impairment of goodwill of the Solar Energy reporting unit as of September 30, 2011 given that the estimated fair value of the Solar Energy reporting unit based on our forecast was in excess of its carrying value. Management's assumptions were based on an analysis of current and expected future economic conditions and the updated strategic plan for this reporting unit. Key assumptions in the calculation of fair value were the discount rate, growth rates in sales and profit margins and long-term cash forecasts, as well as our reconciliation to our market capitalization. The assumptions used in our valuation model included projected growth of our business including pipeline and new business, expected cost reductions and future price declines. We utilized a discount rate which we believed was commensurate with the then current volatility in earnings and cash flows in the solar industry. The estimated fair value of the Solar Energy reporting unit at September 30, 2011 based on our forecast, after analyzing various data points, including our market capitalization, was in excess of the carrying value.

During the three months ended December 31, 2011, conditions in the solar industry continued to decline, including selling prices of solar energy systems. These declines were due to continued softening in demand for the systems, including recent announcements of decreases in government funded solar energy subsidies. We believe these economic factors caused our market capitalization to deteriorate during the three months ended December 31, 2011. We performed an updated analysis to estimate the fair value of our Solar Energy reporting unit, which included a reconciliation by reporting unit to our market capitalization. The carrying value was in excess of fair value requiring a Step 2 analysis to be performed. The Step 2 goodwill impairment analysis required that we estimate the fair values of all assets and liabilities and compare the resulting net assets to our estimated fair value of the reporting unit. The estimate of fair values included Level 1, 2 and 3 inputs and included assumptions such as the replacement cost of property, plant and equipment, sales value of inventories and work-in-process and debt fair values based on rates a market participant would use. Based on this analysis, the estimated fair value of the Solar Energy reporting unit was determined to be below the estimated fair value of the net assets and goodwill was estimated to be zero. Therefore, we impaired the goodwill of the Solar Energy reporting unit of $384.1 million in the three month period ended December 31, 2011. After this impairment charge, which included goodwill associated with the acquisitions of SunEdison, FRV U.S., and three other 2011 acquisitions, the goodwill balance was zero as of December 31, 2011.

Changes in goodwill for the year ended December 31, 2011 are as follows:

In millions	January 1, 2011		Acquisitions (see Note 4)		Impairments			December 31, 2011
Solar Energy	$	342.7	$	97.8	$	(440.5	)	$	—
Total	$	342.7	$	97.8	$	(440.5	)	$	—

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11. DEBT AND CAPITAL LEASE OBLIGATIONS

Debt (including consolidated VIEs) and capital lease obligations outstanding consist of the following:

	As of December 31, 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 and capital leases:
Senior notes	$	550.0	$	—	$	550.0	$	550.0	$	—	$	550.0
Second lien term loan, including amortization of discount	196.1		—		196.1		—		—		—
Long-term notes	16.0		3.4		12.6		21.4		3.7		17.7
Total Non-Solar energy system debt and capital leases	$	762.1	$	3.4	$	758.7	$	571.4	$	3.7	$	567.7
Solar energy system debt, financings and capital leaseback obligations:
Short-term debt, weighted average interest rate of 6.47% and 6.23%, respectively	$	14.7	$	14.7	$	—	$	77.2	$	77.2	$	—
System construction and term debt	271.3		61.3		210.0		305.8		27.9		277.9
Capital leaseback obligations	93.3		7.5		85.8		107.8		13.3		94.5
Financing leaseback obligations	1,107.2		14.3		1,092.9		837.0		8.4		828.6
Other system financing transactions	119.7		—		119.7		27.6		17.4		10.2
Total Solar energy system debt, financings and capital leaseback obligations	$	1,606.2	$	97.8	$	1,508.4	$	1,355.4	$	144.2	$	1,211.2
Total debt outstanding	$	2,368.3	$	101.2	$	2,267.1	$	1,926.8	$	147.9	$	1,778.9

Non-Solar Energy System Debt and Capital Leases

Senior Notes

On March 10, 2011, we issued $550.0 million of 7.75% Senior Notes due April 1, 2019 ("2019 Notes"). We incurred $13.8 million in debt issuance costs, which is amortized into the consolidated statement of operations over the eight year term. The 2019 Notes were sold at a price equal to 100% of the principal amount thereof. The interest on the 2019 Notes is payable semi-annually, in cash in arrears, on April 1 and October 1, commencing October 1, 2011. We may redeem the 2019 Notes at our option, in whole or in part, at any time on or after April 1, 2014, upon not less than 30 nor more than 60 days notice at the redemption prices (expressed as percentages of the principal amount to be redeemed) set forth below, plus any accrued and unpaid interest and additional interest, if any, to the redemption date, if redeemed during the 12-month period beginning on April 1 of the years indicated below.

Year	Price
2014	105.813	%
2015	103.875	%
2016	101.938	%
2017 and thereafter	100.000	%

If a change of control of MEMC occurs, each holder of the 2019 Notes will have the right to require us to repurchase all or any part of that holder's notes at a purchase price of 101% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, to the date of the repurchase.

The 2019 Notes are guaranteed by certain of MEMC's domestic subsidiaries (the “guarantors”). The 2019 Notes are senior unsecured obligations and are subordinated to all of our and the guarantors' existing and future secured debt.

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The indenture governing the 2019 Notes contains covenants that limit our and our subsidiaries' ability, subject to certain exceptions and qualifications, (i) to make certain asset sales, (ii) to make other restricted payments and investments, (iii) to incur indebtedness and issue preferred stock, (iv) to declare dividends, (v) to make other payments affecting restricted subsidiaries, (vi) to enter into certain transactions with affiliates, and (vii) to merge, consolidate or sell substantially all of our assets. These covenants are subject to a number of qualifications and limitations, and in certain situations, a cross default provision.

In addition, the indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among other things: failure to make payments on the 2019 Notes when due, failure to comply with covenants under the indenture, failure to pay other indebtedness or acceleration of maturity of other indebtedness, failure to satisfy or discharge final judgments and occurrence of bankruptcy events. As of December 31, 2012, we were in compliance with all covenants in the indenture governing the 2019 Notes.

Revolving Credit Facility

Our corporate revolving credit facility with Bank of America, N.A. has an aggregate principal amount of $400.0 million (the “Credit Facility”).

The Credit Facility has a term of three years and expires in March of 2014. Our obligations under the facility are guaranteed by certain domestic subsidiaries of MEMC. Our obligations and the guaranty obligations of the subsidiaries are secured by liens on and security interests in substantially all present and future assets of MEMC and the subsidiary guarantors, including a pledge of the capital stock of certain domestic and foreign subsidiaries of MEMC.

Interest under the Credit Facility will accrue, depending on the type of borrowing, at the base rate (in the case of base rate loans and swing line loans) or the eurocurrency rate (in the case of eurocurrency rate loans), plus, in each case, an applicable rate that varies from (currently 3.75%) for the eurocurrency rate to (currently 2.75%) for the base rate, depending on our consolidated leverage ratio. Interest is due and payable in arrears at the end of each interest period (no less than quarterly) and on the maturity date of the Credit Facility. Principal is due on the maturity date. Commitment fees of 0.50% are payable quarterly on the unused portion of the aggregate commitment of $400 million. Letter of credit fees are payable quarterly on the daily amount available to be drawn under a letter of credit at an applicable rate that varies (currently 2.75%), depending on our consolidated leverage ratio.

On February 28, 2012, we amended our Credit Facility to reduce our expected minimum liquidity covenant of $500 million to $450 million and $350 million for the first and second quarters of 2012, respectively.

On May 8, 2012, we further amended our Credit Facility to allow for a consolidated leverage ratio of not greater than 3.0 to 1.0 for the second and third quarters of 2012 and to set our minimum liquidity covenant at $400 million for the third quarter of2012. In the fourth quarter of 2012, our consolidated leverage ratio covenant reverted back to 2.5 to 1.0, and our minimum liquidity covenant under this facility will require a minimum liquidity amount based on our trailing twelve month consolidated EBITDA. Our minimum liquidity covenant amount will be $500 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $400 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $300 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. The interest rates on borrowings under the Credit Facility were also amended to the eurocurrency rate plus 3.75% and the base rate plus 2.75%, as applicable. The Credit Facility was also amended to permit us to incur up to $250 million of convertible or subordinated unsecured indebtedness, subject to compliance with certain conditions.

In order to accommodate the Term Loan described below, the Credit Facility was further amended on September 28, 2012. We incurred $2.0 million in debt issuance costs, which is amortized into the condensed consolidated statement of operations and comprehensive (loss) income over the remaining term of the Credit Facility. There were no changes to the maximum capacity or stated interest rate as part of the amendment, although the Credit Facility lenders and Term Loan lenders entered into a customary intercreditor agreement.

The Credit Facility contains representations, covenants and events of default typical for credit arrangements of comparable size, including maintaining a consolidated leverage ratio and a variable minimum liquidity amount.  The Credit Facility also contains a customary material adverse effects clause and a cross default clause. The cross default clause is applicable to defaults on other indebtedness in excess of $35.0 million, excluding our non-recourse indebtedness. Our liquidity position was in excess of the minimum liquidity amount by $350.7 million and our consolidated leverage ratio was 1.8 at December 31, 2012.

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During 2012 and 2011 we had no borrowings outstanding under this facility, although we had approximately $121.8 million and $173.0 million, respectively, of outstanding third party letters of credit backed by this facility at each year end, which reduces the available capacity.  Therefore, funds available under this facility were $278.2 million and $227.0 million as of December 31, 2012 and December 31, 2011, respectively. We were in compliance with all covenants under this facility at December 31, 2012.

Long-term Notes

Long-term notes at December 31, 2012 totaling $16.0 million are owed to a bank by our Japanese subsidiary, are guaranteed by MEMC, and are secured by the property, plant and equipment of our Japanese subsidiary. These loans mature in years ranging from 2013 to 2017. The guarantees would require us to satisfy the loan obligations in the event that the Japanese subsidiary failed to pay such debt in accordance with its stated terms.

Second Lien Term Loan Credit Agreement

During the third quarter of 2012, we entered into a Second Lien Credit Agreement ("Term Loan") with Goldman Sachs Bank USA and Deutsche Bank Securities Inc. providing for a term loan maturing on October 2, 2017, in an aggregate principal amount of $200.0 million, with a 2.0% discount to par for proceeds of $196.0 million. Additionally, we incurred $10.8 million in debt issuance costs, which are amortized into the condensed consolidated statement of operations and comprehensive (loss) income over the 5 year term. Interest under the Term Loan will accrue, depending on the type of borrowing, at the base rate or the eurocurrency rate, with a floor of 1.50%, plus an applicable rate equal to 9.25% for the eurocurrency rate and 8.25% for the base rate. Interest is due and payable in arrears at the end of each interest period, no less than quarterly, and on the maturity date. As of December 31, 2012, the current interest rate on the Term Loan is 10.75%.

The obligations under the Term Loan are guaranteed by certain of our domestic subsidiaries pursuant to a guaranty agreement executed by each such subsidiary. Our obligations and the guaranty obligations of the subsidiaries are secured by second priority liens on and security interests in substantially all of our present and future assets and the assets of the subsidiary guarantors, including a pledge of the capital stock of domestic and foreign subsidiaries.

We may elect to prepay amounts due under the Term Loan with prior notice to the administrative agent. Any voluntary prepayments made on or prior to March 31, 2014 are subject to yield maintenance payments to the lenders in an amount not less than 3.0% of the principal amount then being prepaid. Voluntary prepayments made after March 31, 2014 but on or prior to March 31, 2015 are subject to a call premium of 3.0% of the principal amount then being prepaid. The call premium reduces to1.0% for prepayments made after March 31, 2015 but on or prior to March 31, 2016. We may make prepayments after March 31, 2016 without penalty.

Similar to the revolving Credit Facility with Bank of America, N.A. (discussed above), the Term Loan contains affirmative and negative covenants. These include but are not limited to limiting the company's and certain of our subsidiaries' ability, subject to certain exceptions and qualifications, to (i) create, incur, assume or suffer any liens on assets or revenues, (ii) make other restricted payments and investments, (iii) incur indebtedness, (iv) make certain transactions with affiliates, (v) merge, consolidate or sell/dispose of assets, (vi) enter into burdensome agreements, (vii) engage in any material line of business different from current lines, or (viii) prepay indebtedness or amend indebtedness that aversely impacts the Term Loan lenders. These covenants are subject to a number of qualifications and limitations.

Additionally, the Term Loan has financial covenants requiring a consolidated leverage ratio of 3.0 to 1.0 on December 31, 2012 and minimum liquidity levels depending on our trailing twelve-month consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA). Our minimum liquidity covenant amount will be $400 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $300 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $200 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. As of December 31, 2012, we were in compliance with all covenants of the Term Loan.

Solar Energy System Debt, Financings and Capital Leaseback Obligations

Our solar energy systems for which we have short-term and long-term debt, capital leaseback and finance obligations are included in separate legal entities. Of this total debt outstanding, $1,562.9 million relates to project specific non-recourse financing that is backed by solar energy system operating assets. This debt has recourse to those separate legal entities but no recourse to MEMC or SunEdison under the terms of the applicable agreements. The recourse finance obligations above are

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fully collateralized by the related solar energy system assets. These obligations may also include limited guarantees by MEMC or SunEdison related to operations, maintenance and certain indemnities.

Short–term Debt

On September 30, 2011, SunEdison amended and restated its non-recourse project construction financing revolver, which has a term of three years, from $50.0 million to $300.0 million. Interest on borrowings under the agreement will be based on our election at LIBOR plus an applicable margin (currently 3.50%) or at a defined prime rate plus an applicable margin (currently 2.50%). The construction financing revolver also requires SunEdison to pay various fees, including a commitment fee (currently 1.10%). The construction financing revolver will be used to support the construction costs of utility and rooftop solar energy systems throughout the U.S. and Canada. The construction loans are non-recourse debt to entities outside of the project company legal entities that subscribe to the debt and is secured by a pledge of the collateral, including the project contracts and equipment. This revolver also includes a customary material adverse effects clause whereby a breach may disallow a future draw but not acceleration of payment. This revolver also maintains a cross default clause whose remedy, among other rights, includes the right to restrict future loans as well as the right to accelerate principal and interest payments. Because this is non-recourse financing, covenants relate specifically to the collateral amounts and transfer of right restrictions.

During 2012, due to various amendments and lenders entering and exiting the facility, the non-recourse construction financing revolver capacity was lowered from $300.0 million to $150.0 million. Under the terms of the amendments, if our Corporate Family or Corporate Credit Rating for Moody's Investors Service ("Moody's") falls below "B1" or our Standard and Poor ("S&P") rating falls below "B+", we will be required to post, at our election, a letter of credit or surety bond equal to 15.0% of the total outstanding balance in order to continue to make additional borrowings under this facility. As of December 31, 2012, our ratings were "B3" and "BB" for Moody's and S&P respectively. Because our Corporate Family Rating for Moody's was below "B1", a letter of credit equal to 15.0% of the $7.4 million outstanding balances was posted as of December 31, 2012. Additionally, $3.9 million of deferred financing fees were charged to interest expense during the second quarter of 2012, as a result of the amendments made to our non-recourse project construction financing revolver. No similar charges were incurred in the comparable period of 2011 or 2010.

As of December 31, 2012 and December 31, 2011, there was $7.4 million and $77.2 million, respectively, outstanding on this construction revolver.

In the event additional construction debt is needed and the remainder of the original capacity is not renewed or replaced, we have the ability to draw upon the available capacity of our revolving credit facility (discussed above). In the event we cannot renew, replace or backfill the remainder of the original capacity with other financing or have adequate net working capital, such inability to fund future projects may have an adverse impact on our business growth plans, financial position and results of operations.

System Construction and Term Debt

SunEdison typically finances its solar energy projects through project entity specific debt secured by the project entity's assets (mainly the solar energy system) with no recourse to MEMC or SunEdison. Typically, these financing arrangements provide for a construction loan, which upon completion will be converted into a term loan, and generally do not restrict the future sale of the project entity to a third party buyer. On December 31, 2012, SunEdison had system construction and term debt outstanding of $271.3 million.Of this amount, $188.7 million relates to variable rate debt with interest rates that are tied to either the London Interbank Offered Rate, the Euro Interbank Offer Rate, the Canadian Dollar Offered Rate or the PRIME rate. The variable interest rates have primarily been hedged by our outstanding interest rate swaps as discussed in Note 5. The interest rates on the remaining construction and term debt range from 3.0% to 12.0%. The maturities range from 2013 to 2033 and these facilities are collateralized by the related solar energy system assets with a carrying amount of $80.5 million.

During the second quarter of 2012, we violated covenants of two non-recourse solar energy system loans totaling $24.1 million as a result of the devaluation of the local currency (Indian Rupee). On September 28, 2012, we obtained a waiver from the lender for the covenant violations, which has a grace period until November 20, 2013. During the grace period, the debt will be classified as short-term debt.  We can make no assurances that the covenants will be met after the grace period. The solar energy systems for these two project companies collateralize the loans and there is no recourse outside of these project companies.

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Capital Leaseback Obligations

We are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. On December 31, 2012, SunEdison had $93.3 million of capital lease obligations outstanding. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system and the transaction is not subject to real estate accounting. The terms of the leases are typically 25 years with certain leases providing terms as low as 10 years and providing for early buyout options. The specified rental payments are based on projected cash flows that the solar energy system will generate. Since the SunEdison acquisition date on November 20, 2009, SunEdison has not entered into any arrangements that have resulted in accounting for the sale leaseback as a capital lease.

Financing Leaseback Obligations

As more fully described in Note 2, Revenue Recognition - Financing arrangements, in certain transactions we account for the proceeds of sale leasebacks as financings, which are typically secured by the solar energy system asset and its future cash flows from energy sales, but without recourse to MEMC or SunEdison under the terms of the arrangement. The structure of the repayment terms under the lease results in negative amortization throughout the financing period, and we therefore recognize the lease payments as interest expense. The balance outstanding for sale leaseback transactions accounted for as financings as of December 31, 2012 is $1,107.2 million, which includes the below mentioned transactions. The maturities range from 2021 to 2037 and are collateralized by the related solar energy system assets with a carrying amount of $1,105.8 million.

On March 31, 2011, one of SunEdison's project subsidiaries executed a master lease agreement with a U.S. financial institution which provides for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. The total capacity under this agreement is $120.0 million, of which $68.0 million is outstanding and $52.0 million is available as of December 31, 2012. The specified rental payments will be based on projected cash flows that the solar energy systems will generate.

On September 24, 2012, one of SunEdison's project subsidiaries executed a master lease agreement with a U.S. financial institution which provides for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. The total capacity under this agreement was $52.5 million, of which $26.9 million is outstanding and $25.6 million was available as of December 31, 2012. The specified rental payments will be based on projected cash flows that the solar energy systems will generate.

Other System Financing Transactions

Other system financing transactions represent the cash proceeds that SunEdison received in connection with an executed solar energy system sales contract that has not met the sales recognition requirements under real estate accounting and has been accounted for as a financing. Included in other system financing is $17.6 million of proceeds collected under three separate solar energy system sales agreements with the buyer that provides the buyer with a put option that could become an obligation in the event that we are unable to fulfill certain performance warranties set to expire during 2015. The remaining portion of other system financings of $102.1 million relates to cash proceeds received in connection with separate solar energy system sales contracts for which SunEdison has substantial continuing involvement. There are no principal or interest payments associated with these transactions. Of the $102.1 million, $39.5 million relates to two projects sold in Italy which did not meet the requirements to record revenue due to an indemnification that expires in 2016. The remaining amount relates to six projects sold in the United States, Korea, and Canada.

Other Facilities

Other Financing Commitments

We have short-term committed financing arrangements of approximately $32.3 million at December 31, 2012, of which there were no short-term borrowings outstanding as of December 31, 2012. Of this amount, $13.5 million is unavailable because it relates to the issuance of third party letters of credit. Interest rates are negotiated at the time of the borrowings.

During the years ended December 31, 2012 and 2011, we capitalized $19.9 million and $18.1 million of interest to the consolidated balance sheet, respectively.

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Maturities

The aggregate amounts of payments on long-term debt, excluding financing leaseback obligations, after December 31, 2012 are as follows:

	2013		2014		2015		2016		2017		Thereafter		Total
In millions
Maturities of long-term debt (a)	$	64.6	$	30.8	$	28.6	$	51.0	$	206.7	$	771.2	$	1,152.9

(a) Included in maturities of long-term debt is $119.7 million of maturities relating to other system financing transactions that represent the contract price for solar energy systems under existing sales contracts that contain certain contractual provisions that preclude sale treatment under real estate accounting rules. We account for these transactions as financings of $17.6 million and $102.1 million that will mature upon the expiration of the contractual provisions that preclude sale treatment in years 2015 and thereafter, respectively. These could become payment obligations in the event we default under the executed sales agreement, and the buyer may execute its contractual option to put (sell) the project back to SunEdison for a full refund of the contract price.

The aggregate amounts of payments on capital leases after December 31, 2012 are as follows:

In millions
2013	$	9.8
2014	6.6
2015	5.3
2016	5.7
2017	5.8
Thereafter	90.9
Total minimum lease payments	124.1
Less amounts representing interest	(30.8		)
Present value of minimum lease payments	93.3
Less current portion of obligations under capital leases	(7.5		)
Noncurrent portion of obligations under capital leases	$	85.8

The aggregate amounts of minimum lease payments on our financing leaseback obligations are $890.2 million. Payments from 2013 through 2017 are as follows:

In millions	2013		2014		2015		2016		2017
Minimum lease payments	$	60.5	$	48.5	$	46.4	$	42.9	$	40.9

12. STOCKHOLDERS’ EQUITY

Preferred Stock

We have 50.0 million authorized shares of $.01 par value preferred stock and no preferred shares issued and outstanding as of December 31, 2012 and 2011. The Board of Directors is authorized, without further action by the stockholders, to issue any or all of the preferred stock.

Common Stock

Holders of our $.01 par value common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders. Subject to the rights of any holders of preferred stock, holders of common stock are entitled to receive ratably such dividends as may be declared by the Board of Directors. In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to share ratably in the distribution of all assets remaining after payment of liabilities, subject to the rights of any holders of preferred stock. The declaration and payment of future dividends on our common stock, if any,

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will be at the sole discretion of the Board of Directors and is subject to restrictions as contained in the amended and restated credit facility (see Note 11). There were no dividends declared or paid during the years ended December 31, 2012, 2011 and 2010.

On November 20, 2009, we completed the acquisition of SunEdison by paying a portion of the consideration in 3.8 million shares of MEMC common stock with an acquisition date fair value of $45.8 million and providing contingent consideration. The value of the shares was based upon the closing price of MEMC’s common stock at the date of acquisition, or $12.08. On February 1, 2011, MEMC issued 2.1 million shares of MEMC common stock in connection with the SunEdison contingent consideration payout.

Our Board of Directors has approved a $1.0 billion stock repurchase program. The stock repurchase program allows MEMC to purchase common stock from time to time on the open market or through privately negotiated transactions using available cash. The specific timing and amount of repurchases will vary based on market conditions and other factors and may be modified, extended or terminated by the Board of Directors at any time. No shares were repurchased in 2012, 2011, or 2010 under the stock repurchase program. From inception through December 31, 2012, we have repurchased 9.0 million shares at a total cost of $448.0 million.

Redeemable Noncontrolling Interest

On June 27, 2012, we issued redeemable common stock in certain consolidated subsidiaries to a non affiliated third party representing a 15% noncontrolling interest in those consolidated subsidiaries. We received cash proceeds of $11.4 million in 2012 as consideration for the redeemable stock issuance, which was initially measured and reported net of stock issuance costs of $1.4 million in the temporary equity section on the consolidated balance sheet as Redeemable Noncontrolling Interest. Under the terms of the arrangement, the noncontrolling interest holder has an option to make additional investments up to an aggregate of approximately $55 million. The noncontrolling interest holder also has a contingent right to require us to repurchase the holder's 15% interest at a redemption price that does not represent fair value. The noncontrolling interest becomes redeemable at the earlier of (i) April 15, 2019 or (ii) the occurrence of certain contingent events, including those that are not solely within the control of the company. Accordingly, we have adjusted the redeemable noncontrolling interest to its expected redemption value, resulting in a $1.6 million reduction to retained earnings as of December 31, 2012.

Stock-Based Compensation

We have equity incentive plans that provide for the award of non-qualified stock options, restricted stock, performance shares, and restricted stock units to employees, non-employee directors and consultants. We issue new shares to satisfy stock option exercises. As of December 31, 2012, there were 5.1 million shares authorized for future grant under these plans. Options to employees are generally granted upon hire and annually or semi-annually, usually with four-year ratable vesting, although certain grants have three, four or five-year cliff vesting. No option has a term of more than 10 years. The exercise price of stock options granted has historically equaled the market price on the date of the grant.

The following table presents information regarding outstanding stock options as of December 31, 2012 and changes during the year then ended with regard to stock options:

	Shares		Weighted- Average Exercise Price		Aggregate Intrinsic Value (in millions)		Weighted- Average Remaining Contractual Life
Beginning of year	17,066,401		$	19.21
Granted *	16,119,890		2.82
Exercised	—		—
Forfeited	(6,090,871	)	11.59
Expired	(5,684,301	)	30.20
End of year	21,411,119		$	6.12	$	7.7	8
Options exercisable at year-end	2,940,515		$	17.50	$	7.5	6

* Included in the 16,119,890 options granted in 2012 is the 9.4 million market based awards issued to select employees, including senior executives, excluding the chief executive officer.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between our closing stock price on the last trading day of 2012 and the exercise price, multiplied by the number of in-the-money options) that would

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have been received by the option holders had all option holders exercised their options on December 31, 2012. This amount changes based on the fair market value of our stock. There were no material amounts of option exercises and related cash receipts or tax benefits realized for 2012, 2011 or 2010.

At our May 25, 2012 annual meeting of stockholders, stockholders approved amendments to our equity incentive plans to permit a one-time stock option exchange program pursuant to which certain employees, excluding directors and executive officers, would be permitted to surrender for cancellation certain outstanding stock options with an exercise price substantially greater than our then current trading price in exchange for fewer stock options at a lower exercise price. The option exchange program commenced on July 17, 2012 and closed on August 17, 2012. The number of new stock options replacing surrendered eligible options was determined by an exchange ratio dependent on the exercise price of the original options and constructed to result in the new option value being approximately equal to the value of surrendered options. The program was designed to cause us to incur minimal incremental stock-based compensation expense in future periods. The option exchange resulted in the cancellation of 6.9 million old options and the issuance of 2.0 million new options with an award date of August 20, 2012 and a new exercise price of $2.77 per share. The cancelled options are reflected in the rollforward above as either forfeited or expired, depending on whether or not the old options were vested or not. New options issued in the exchange will vest over a two or three year period depending on whether the surrendered options were fully or partially vested. The incremental fair value created under the stock option exchange was $0.2 million, and this cost will be recognized on a straight line basis over the two or three year vesting period. The compensation cost of the original awards will continue to be expensed under the original vesting schedule.

During the third quarter 2012, we granted an aggregate of 9.4 million options with a 10-year contractual term to select employees, including senior executives, excluding the chief executive officer. The options will vest in three tranches one year after MEMC stock achieves the following three price hurdles for 30 consecutive calendar days: $7.00, $10.00 and $15.00. If the individual price hurdles are not met within five years of the grant date, the options tied to that individual price hurdle will be cancelled. The grant date fair value of these awards was $11.0 million and this compensation cost will be expensed on a straight line basis over the service period of each separately identified tranche. The grant date fair value was calculated for these awards using a probabilistic approach under a Monte Carlo simulation taking into consideration volatility, interest rates and expected term. Because the vesting of these awards is based on stock price performance (i.e. a market condition), it is classified as an equity award. The market price hurdles were not met during 2012.

Our weighted-average assumptions are as follows:

	2012		2011		2010
Risk-free interest rate	0.8	%	1.7	%	1.8	%
Expected stock price volatility	68.1	%	65.7	%	67.0	%
Expected term until exercise (years)	4		4		4
Expected dividends	—	%	—	%	—	%

The weighted-average grant-date fair value per share of options granted was $1.18, $5.94 and $7.04 for 2012, 2011 and 2010, respectively. As of December 31, 2012, $36.0 million of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of 3.4 years.

Restricted stock units represent the right to receive a share of MEMC stock at a designated time in the future, provided the stock unit is vested at the time. Recipients of restricted stock units do not pay any cash consideration for the restricted stock units or the underlying shares, and do not have the right to vote or have any other rights of a stockholder until such time as the underlying shares of stock are distributed. Restricted stock units granted to non-employee directors generally vest over a two-year period from the grant date. Restricted stock units granted to employees usually have three, four or five year cliff vesting, or four-year ratable vesting, and certain grants are subject to performance conditions established at the time of grant.

In conjunction with our purchase of SunEdison on November 20, 2009, we approved a Special Inducement Grant Plan. Pursuant to this plan, SunEdison’s senior management and certain continuing SunEdison employees received an aggregate of 584,372 restricted stock units which cliff vested on the one year anniversary date of the acquisition. Also under this plan, continuing SunEdison employees were granted an additional aggregate of 1,644,529 restricted stock units which will be subject to both future performance and time vesting requirements. The performance requirements of this latter set of grants are tied to the same metrics as the contingent consideration payable to SunEdison unit holders. SunEdison met its performance requirements and the former SunEdison employees had the following vesting schedule: (i) 34% of such earned grants vested on January 31, 2011, (ii) 33% vested on December 31, 2011, and (iii) the remaining 33% vested on December 31, 2012. The expense associated with these RSUs was not considered part of the purchase price of SunEdison because the employees were

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required to render future service in order to vest in these awards and thus, the compensation expense is recognized over the future vesting periods as the services are rendered. The amount of stock compensation expense for the year ended December 31, 2012, 2011 and 2010 related to the cliff vesting awards was $0.0, $1.6 million and $6.2 million, respectively. The amount of stock compensation expense for the year ended December 31, 2012, 2011 and 2010 related to the performance awards was $2.7 million, $3.2 million and $8.1 million, respectively.

The following table presents information regarding outstanding restricted stock units as of December 31, 2012 and changes during the year then ended:

	Restricted Stock Units		Aggregate Intrinsic Value (in millions)		Weighted-Average Remaining Contractual Life
Beginning of year	4,692,159
Granted	1,469,549
Converted	(680,611	)
Forfeited	(1,079,329	)
End of year	4,401,768		$	13.7	2

At December 31, 2012, there were no restricted stock units which were convertible. As of December 31, 2012, $18.9 million of total unrecognized compensation cost related to restricted stock units is expected to be recognized over a weighted-average period of approximately 2 years. The weighted-average fair value of restricted stock units on the date of grant was $3.06, $11.09 and $14.64 in 2012, 2011 and 2010, respectively.

The amount of stock-based compensation cost capitalized into inventory and fixed assets was not material for the years ended December 31, 2012, 2011 and 2010. Further, the recognition of excess tax benefits from share-based payment arrangements was not material for the years ended December 31, 2012, 2011 and 2010.

Stock-based compensation expense recorded for the years ended December 31, 2012, 2011 and 2010 was allocated as follows:

	2012		2011		2010
In millions
Cost of goods sold	$	5.9	$	5.9	$	5.7
Marketing and administration	21.7		32.5		40.8
Research and development	3.8		5.0		4.7
Stock-based employee compensation	$	31.4	$	43.4	$	51.2

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13. (LOSS) EARNINGS PER SHARE

In 2012, 2011 and 2010, basic and diluted (loss) earnings per share (EPS) were calculated as follows:

	2012						2011						2010
	Basic			Diluted			Basic			Diluted			Basic		Diluted
In millions, except per share amounts
EPS Numerator:
Net (loss) income attributable to common stockholders	$	(150.6	)	$	(150.6	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
Adjustment of redeemable noncontrolling interest	(1.6		)	(1.6		)	—			—			—		—
Adjusted net (loss) income to common stockholders	$	(152.2	)	$	(152.2	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
EPS Denominator:
Weighted-average shares outstanding	230.9			230.9			229.9			229.9			226.9		226.9
Stock options and restricted stock units	—			—			—			—			—		1.2
Common stock related to acquisitions	—			—			—			—			—		2.1
Total shares	230.9			230.9			229.9			229.9			226.9		230.2
(Loss) earnings per share	$	(0.66	)	$	(0.66	)	$	(6.68	)	$	(6.68	)	$	0.15	$	0.15

Common stock related to acquisitions reflects the impact of the SunEdison contingent consideration as discussed in Note 19.

As part of the acquisition agreement for SunEdison, a portion of the shares issued in conjunction with the purchase were held in escrow. During the third quarter of 2011, the majority of those shares and cash held in escrow were released. Additional shares and cash were released in 2012 and the remaining shares and cash are scheduled to be released from escrow, if at all, in 2013.

In 2012 and 2011, all options to purchase MEMC stock and restricted stock units were excluded from the calculation of diluted EPS because the effect was antidilutive due to the net loss incurred for the respective periods. In 2010, options and restricted stock units to purchase 15.5 million shares of MEMC stock were excluded from the calculation of diluted EPS because the effect was antidilutive.

14. INCOME TAXES

The net loss before income tax expense (benefit) and equity in (loss) earnings of joint ventures consists of the following:

	For the year ended December 31,
	2012			2011			2010
In millions
U.S.	$	(261.1	)	$	(780.6	)	$	(157.8	)
Foreign	179.6			(603.5		)	145.3
Total	$	(81.5	)	$	(1,384.1	)	$	(12.5	)

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Income tax expense (benefit) consists of the following:

	Current			Deferred			Total
In millions
Year ended December 31, 2012:
U.S. Federal	$	38.9		$	(0.2	)	$	38.7
State and local	(14.0		)	0.7			(13.3		)
Foreign	47.5			(8.0		)	39.5
Total	$	72.4		$	(7.5	)	$	64.9
Year ended December 31, 2011:
U.S. Federal	$	6.7		$	37.2		$	43.9
State and local	4.6			4.7			9.3
Foreign	15.9			4.0			19.9
Total	$	27.2		$	45.9		$	73.1
Year ended December 31, 2010:
U.S. Federal	$	(46.6	)	$	(29.6	)	$	(76.2	)
State and local	(3.8		)	(2.3		)	(6.1		)
Foreign	44.2			(15.2		)	29.0
Total	$	(6.2	)	$	(47.1	)	$	(53.3	)

Effective Tax Rate

Income tax expense (benefit) differed from the amounts computed by applying the statutory U.S. federal income tax rate of 35% to loss before income taxes and equity in (loss) earnings of joint ventures. The “Effect of foreign operations” includes the net reduced taxation of foreign profits from combining jurisdictions with rates above and below the U.S. federal statutory rate and the impact of U.S. foreign tax credits.

	For the year ended December 31,
	2012		2011		2010
Income tax at federal statutory rate	(35.0	)%	(35.0	)%	(35.0	)%
Increase (reduction) in income taxes:
Effect of foreign operations	(71.6	)	19.3		(47.4	)
Foreign incentives	(5.7	)	(1.1	)	(121.6	)
Foreign repatriation	(2.1	)	0.4		(91.7	)
State income taxes, net of U.S. Federal benefit	(16.6	)	0.7		(26.8	)
Tax authority positions, net	3.8		1.2		(97.0	)
Valuation allowance	183.2		15.1		—
Other, net	23.6		4.7		(6.9	)
Effective tax expense (benefit) rate	79.6	%	5.3	%	(426.4	)%

The 2012 net expense is primarily the result of the worldwide operational earnings mix at various rates, charges recognized to establish valuation allowances on certain deferred tax assets due to the likely inability to realize benefit for certain future tax deductions, a net increase to the reserve for uncertain tax positions, and the impact of examination of tax returns by the Internal Revenue Service (“IRS”), partially offset by the release of a valuation allowance in a foreign jurisdiction.

The 2011 net expense is primarily the result of charges taken to value certain deferred tax assets as a result of the continued decline in solar market conditions, the restructuring charges announced on December 8, 2011, and cumulative losses in the U.S. and certain foreign jurisdictions. The domestic impact is the combination of charges taken related to certain deferred tax and the impact, including foreign tax credits, of the deemed repatriation of the earnings of certain foreign subsidiaries. The foreign impact is a net tax expense lower than the U.S. federal income tax rate due to lower statutory tax rates, available tax incentives and reserves for uncertain tax positions. The 2010 net benefit is the result of a benefit associated with the mix of earnings and losses amongst domestic and foreign locations.

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Certain of our Asian subsidiaries have been granted a concessionary tax rate of between 0% and 5% on all qualifying income for a period of up to five to ten years based on investments in certain plant and equipment and other development and expansion activities, resulting in a tax benefit for 2012, 2011 and 2010 of approximately $4.6 million, $15.7 million and $15.0 million, respectively. Under the awards, the income tax rate for qualifying income will be taxed at an incentive tax rate lower than the corporate tax rate. The company is in compliance with the qualifying condition of their tax incentives. The last of these incentives will expire between 2013 and 2022.

During the quarter ended June 30, 2010, we concluded an IRS examination for the 2006 and 2007 tax years and, as a result, we recorded favorable and unfavorable adjustments to our accrual for uncertain tax positions. We received proposed taxable income adjustments from the IRS related to various cost allocations and taxable income adjustments attributable to our foreign operations. The settlement of those positions resulted in an increase to the accrual of $29.9 million. The resolution of these matters resulted in an assessment of $31.6 million, which included penalties and interest of $5.0 million, net of $2.3 million of federal benefit. Additionally, MEMC had uncertain tax positions for deductions and tax credits that were effectively settled during the exam which reduced the accrual by $51.0 million. The net effect to our tax provision for the closure of the exam was a $15.5 million tax benefit.

We are currently under examination by the IRS for the 2008, 2009 and 2010 tax years. Additionally, due to the carryback of our 2009 net operating loss for utilization against the 2007 tax liability, the IRS has re-opened the 2007 tax year for further review. We believe it is reasonably possible that some portions of the examination could be completed within the next twelve months; however, the results of the examination and any potential settlement are not reasonably estimable at this time.

During 2009, we determined that the undistributed earnings of one of our foreign wholly-owned subsidiaries would be remitted to the U.S. in the foreseeable future. These earnings were previously considered permanently reinvested in the business, and the deferred tax asset related to these earnings was not recognized. The deferred tax effect of this newly planned remittance was recorded as a discrete net income tax benefit in the amount of $2.4 million in the year ended December, 31 2009 and an additional benefit of $11.3 million for the year ended December 31, 2010. Due to the restructuring announcement made on December 8, 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future, and the deferred tax benefit previously recorded of $13.4 million has been reversed in 2011. Federal and state income taxes have not been provided on accumulated but undistributed earnings of foreign subsidiaries aggregating approximately $382.7 million and $1,031.6 million at December 31, 2012 and 2011, respectively, because such earnings have been permanently reinvested in the business. The determination of the amount of the unrecognized deferred tax liability related to our undistributed earnings is not practicable.

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

	For the year ended December 31,
	2012			2011
In millions
Beginning of year	$	46.2		$	30.4
Additions based on tax positions related to the current year	7.8			15.9
Reductions for tax positions of prior years	(3.1		)	(0.1		)
End of year	$	50.9		$	46.2

At December 31, 2012 and 2011, we had $53.2 million and $48.3 million, respectively, of unrecognized tax benefits, net of U.S. federal, state and local deductions, associated with open tax years for which we are subject to audit in various U.S. federal, and various state and foreign jurisdictions. This also includes estimated interest and penalties. The current change to the reserve includes an increase of $4.7 million primarily related to taxable income adjustments attributable to foreign operations. All of our unrecognized tax benefits at December 31, 2012 and 2011 would favorably affect our effective tax rate if recognized. We are subject to examination in various jurisdictions for the 2003 through 2011 tax years.

During the years ended December 31, 2012 and 2011, we recognized approximately $0.2 million and $0.4 million, respectively, in interest and penalties and had approximately $2.3 million and $2.1 million accrued at December 31, 2012 and 2011, respectively, for the payment of interest and penalties.

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Deferred Taxes

The tax effects of the major items recorded as deferred tax assets and liabilities are:

	As of December 31,
	2012			2011
In millions
Deferred tax assets:
Inventories	$	14.9		$	17.1
Restructuring liabilities	31.2			42.5
Expense accruals	52.0			53.1
Solar energy systems	461.9			366.7
Deferred revenue	66.3			4.4
Property, plant and equipment	35.7			54.1
Pension, medical and other employee benefits	12.2			27.2
Foreign repatriation	3.4			3.4
Net operating loss carryforwards	132.3			91.5
Foreign tax credits	70.8			28.8
Other	75.6			38.4
Total deferred tax assets	956.3			727.2
Valuation allowance	(510.5		)	(415.7		)
Net deferred tax assets	445.8			311.5
Deferred tax liabilities:
Solar energy systems	(286.7		)	(191.2		)
Other	(74.2		)	(12.4		)
Total deferred tax liabilities	(360.9		)	(203.6		)
Net deferred tax assets	$	84.9		$	107.9

The solar energy systems deferred tax asset of $461.9 million is entirely associated with the Solar Energy segment. For tax purposes, income is recognized in the initial transaction year for all solar system sales and sale leasebacks; Note 2 discusses the book accounting for each of the different revenue recognition policies. The deferred tax asset represents the future disallowance of deferred book revenue recognized in post transaction years.

Our deferred tax assets and liabilities, netted by taxing location, are in the following captions in the consolidated balance sheet:

	As of December 31,
	2012			2011
In millions
Current deferred tax assets, net (recorded in prepaids and other current assets)	$	90.8		$	63.1
Non-current deferred tax (liabilities) assets, net	(5.9		)	44.8
Total	$	84.9		$	107.9

Our net deferred tax assets totaled $84.9 million at December 31, 2012 compared to $107.9 million at December 31, 2011. In 2012, the decrease of $23.0 million in net deferred tax assets is primarily attributable to a net increase in valuation allowances of $94.8 million, partially offset by additional deferred tax assets associated with future disallowances of deferred book revenue for solar energy systems. Deferred tax assets generated in 2012 were reduced by recognizing an increase in the valuation allowance associated with our U.S. operations, which were in a three-year cumulative loss position in both 2011 and 2012. This contributed to the majority of the increase in the valuation allowance in 2012. At December 31, 2012, we have valuation allowances of $510.5 million. We believe that it is more likely than not, with our projections of future taxable income in certain jurisdictions, that we will generate sufficient taxable income to realize the benefits of the net deferred tax assets of $84.9 million. At December 31, 2012, we had deferred tax assets associated with net operating loss carryforwards of $6.9 million in certain foreign jurisdictions; if unused, these will expire in 2022.

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15. EMPLOYEE-RELATED LIABILITIES

Pension and Other Post-Employment Benefit Plans

Prior to January 2, 2002, our defined benefit pension plan covered most U.S. employees. Benefits for this plan were based on years of service and qualifying compensation during the final years of employment. Effective January 2, 2002, we amended our defined benefit plan to discontinue future benefit accruals for certain participants. In addition, effective January 2, 2002, no new participants will be added to the plan. Effective January 1, 2012, the accumulation of new benefits for all participants under our defined benefit pension plan was frozen. This change did not have a material impact on the Company's financial statements because the plan was frozen to new participants in 2001 and combined with turnover, the level of active participants was not significant.

We also have a non-qualified plan under the Employee Retirement Income Security Act of 1974. This plan provides benefits in addition to the defined benefit plan. Eligibility for participation in this plan requires coverage under the defined benefit plan and other specific circumstances. The non-qualified plan has also been amended to discontinue future benefit accruals.

Prior to January 1, 2002, our health care plan provided post-retirement medical benefits to full-time U.S. employees who met minimum age and service requirements. The plan is contributory, with retiree contributions adjusted annually, and contains other cost-sharing features such as deductibles and coinsurance. Effective January 1, 2002, we amended our health care plan to discontinue eligibility for post-retirement medical benefits for certain participants. In addition, effective January 2, 2002, no new participants will be eligible for post-retirement medical benefits under the plan.

Effective January 1, 2012, the amortization period for the unamortized unrealized loss was changed to the remaining life expectancy of the plan participants, which was derived from an actuarial mortality table. This change was triggered since substantially all the plan participants are now inactive/retired. Prior to 2012, the amortization period was derived based on the average remaining service period of the active participants expected to receive benefits. This change has reduced the amortization expense related to the unrealized loss.

Net periodic post-retirement benefit cost (income) consists of the following:

	Pension Plans									Health Care and Other Plans
Year ended December 31,	2012			2011			2010			2012			2011			2010
In millions
Service cost	$	1.1		$	2.9		$	2.9		$	—		$	—		$	—
Interest cost	7.8			9.4			9.6			0.8			1.1			1.4
Expected return on plan assets	(13.8		)	(15.4		)	(14.3		)	—			—			—
Amortization of prior service cost	—			—			—			(0.7		)	(0.5		)	(0.5		)
Net actuarial loss (gain)	4.1			7.9			8.5			(0.5		)	(1.5		)	(1.6		)
Settlement charges	6.7			—			—			—			—			—
Net periodic benefit cost (income)	$	5.9		$	4.8		$	6.7		$	(0.4	)	$	(0.9	)	$	(0.7	)

In 2012, the MEMC pension plans experienced significant lump sum payment activity related to the 2011 global reduction in force previously described in Note 3. This event triggered settlement accounting with both the US and foreign plans because there were significant pension benefit obligations settled during 2012.

To determine pension and other post-retirement and post-employment benefit measurements for the plans, we use a measurement date of December 31. The following is a table of actuarial assumptions used to determine the net periodic benefit cost (income):

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	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012		2011		2010		2012		2011		2010
Weighted-average assumptions:
Discount rate	3.65	%	4.58	%	5.18	%	3.93	%	5.09	%	5.65	%
Expected return on plan assets	8.34	%	8.36	%	8.38	%	NA		NA		NA
Rate of compensation increase	3.62	%	3.63	%	3.73	%	3.75	%	3.75	%	3.75	%
Current medical cost trend rate	NA		NA		NA		8.00	%	8.00	%	8.00	%
Ultimate medical cost trend rate	NA		NA		NA		5.00	%	5.00	%	5.75	%
Year the rate reaches ultimate trend rate	NA		NA		NA		2018		2017		2016

The following summarizes the change in benefit obligation, change in plan assets, and funded status of the plans:

	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012			2011			2012			2011
In millions
Change in benefit obligation:
Benefit obligation at beginning of year	$	227.2		$	213.3		$	20.1		$	23.0
Service cost	1.1			2.9			—			—
Interest cost	7.8			9.4			0.8			1.1
Plan participants’ contributions	—			—			0.5			0.8
Plan amendments	—			—			—			(3.9		)
Actuarial loss	17.8			19.0			2.3			1.1
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Settlements	(21.0		)	(2.1		)	—			—
Currency exchange gain	(0.7		)	(0.4		)	—			—
Benefit obligation at end of year	$	223.5		$	227.2		$	21.5		$	20.1
Change in plan assets:
Fair value of plan assets at beginning of year	$	176.0		$	192.2		$	—		$	—
Actual (loss) gain on plan assets	22.3			(2.4		)	—			—
Employer contributions	0.6			1.5			1.7			1.2
Plan participants’ contributions	—			—			0.5			0.8
Settlements	(18.5		)	—			—			—
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Currency exchange (loss) gain	0.1			(0.4		)	—			—
Fair value of plan assets at end of year	$	171.8		$	176.0		$	—		$	—
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)
Amounts recognized in statement of financial position:
Other assets, noncurrent	$	—		$	—		$	—		$	—
Accrued liabilities, current	(0.6		)	(0.7		)	(1.4		)	(1.2		)
Pension and post-employment liabilities, noncurrent	(51.1		)	(50.5		)	(20.1		)	(18.9		)
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)

Amounts recognized in accumulated other comprehensive (loss) income (before tax):

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	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012			2011
In millions
Net actuarial loss (gain)	$	86.8	$	88.2	$	(0.3	)	$	(3.1	)
Prior service credit	—		—		(12.1		)	(12.8		)
Net amount recognized	$	86.8	$	88.2	$	(12.4	)	$	(15.9	)

The estimated amounts that will be amortized from accumulated other comprehensive (loss) income into net periodic benefit cost (income) in 2013 are as follows:

	Pension Plans		Health Care and Other Plans
In millions
Actuarial loss	$	2.6	$	—
Prior service credit	—		(0.7		)
Total	$	2.6	$	(0.7	)

The following is a table of the actuarial assumptions used to determine the benefit obligation:

	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012		2011
Weighted-average assumptions:
Discount rate	3.14	%	3.65	%	3.37	%	3.95	%
Rate of compensation increase	—	%	3.62	%	3.75	%	3.75	%

The composition of our plans and age of our participants are such that, as of December 31, 2012 and 2011, the medical cost trend rate no longer has a significant effect on the valuation of our health care plans.

The U.S. pension plan assets are invested primarily in marketable securities, including common stocks, bonds and interest-bearing deposits. The weighted-average allocation of pension benefit plan assets at year ended December 31 were as follows:

			Actual Allocation				Fair Value
Asset Category (Dollars in millions)	2012 Target Allocation		2012		2011		2012		2011
Cash	—	%	32	%	15	%	$	53.7	$	24.8
Equity securities	60	%	55	%	61	%	92.9		105.2
Fixed income securities	40	%	13	%	24	%	21.9		41.6
Total	100	%	100	%	100	%	$	168.5	$	171.6

Asset Category (In millions)	Asset Value as of December 31, 2012		Asset Value as of December 31, 2011
Cash and cash equivalents	$	53.7	$	24.8
Equity securities:
U.S. large cap	38.5		50.9
Mid cap	11.1		11.9
Small cap	11.0		11.3
International	22.0		21.3
Emerging markets	10.3		9.8
Fixed income:
Investment grade bonds	8.3		15.8
Corporate bonds	13.6		25.8
Total	$	168.5	$	171.6

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The investment objectives of our pension plan assets are as follows:

• To achieve a favorable relative return as compared with inflation;

• To achieve an above average total rate of return relative to capital markets;

• Preservation of capital through a broad diversification among asset classes which react, as nearly as possible, independently to varying economic and market circumstances; and

• Long-term growth, with a degree of emphasis on stable growth, rather than short-term capital gains.

Our pension cost (income) and pension liabilities are actuarially determined, and we use various actuarial assumptions, including the discount rate, rate of salary increase, and expected return on plan assets to estimate our pension cost (income) and obligations. We determine the expected return on plan assets based on our pension plans’ intended long-term asset mix. The expected investment return assumption used for the pension plans reflects what the plans can reasonably expect to earn over a long-term period considering plan target allocations. The expected return includes an inflation assumption and adds real returns for the asset mix and a premium for active management, and subtracts expenses. While the assumed expected rate of return on the U.S. pension plan assets in 2012 and 2011 was 8.5% and 8.5%, respectively, the actual return experienced in our pension plan assets in the comparable periods in 2012 and 2011 was 12.8% and (1.3)%, respectively. We consult with the plans’ actuaries to determine a discount rate assumption for pension and other post-retirement and post-employment plans that reflects the characteristics of our plans, including expected cash outflows from our plans, and utilize an analytical tool that incorporates the concept of a hypothetical yield curve.

Our pension obligations are funded in accordance with provisions of federal law. Contributions to our pension and post-employment plans in 2012 totaled $0.6 million and $1.7 million, respectively, and in 2011 totaled $1.5 million and $1.2 million, respectively. The funding status of our U.S pension plan was underfunded by $19.5 million and $19.1 million as of December 31, 2012 and December 31, 2011, respectively, and recorded in pension and post-employment liabilities. Our foreign pension plans and health care and other plans continue to maintain an underfunded status as of December 31, 2012 and 2011 and are recorded in pension and post-employment liabilities. As of December 31, 2012, the accumulated benefit obligation for our U.S. pension plan was $187.9 million and the fair value of plan assets was $168.4 million. We expect contributions to our pension and post-employment plans in 2013 to be approximately $0.0 million and $1.4 million, respectively.

MEMC uses appropriate valuation techniques based on the available inputs to measure the fair value of its investments. When available, MEMC measures fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value. As of December 31, 2012 and 2011, the pension plan’s investments in equity and fixed income securities were all valued using Level 1 inputs based on the fair value as determined by quoted market price on a daily basis, except for $53.7 million that was valued using level 3 inputs as of December 31, 2012. This asset is an investment in a group annuity contract and the fair value is estimated to be the contract value of the group annuity contract. The pension plan can make withdrawals from the group annuity contract subject to certain provisions and restrictions. As there is a full guarantee of the contract value and the risk to the plan assets is minimized with such a guarantee the contract value is deemed to be an appropriate approximation of fair value. There were no similar assets as of December 31, 2011.

As discussed above, in 2011 the U.S. pension plan assets decreased to less than the accumulated benefit obligation. As of December 31, 2012 and 2011, the projected benefit obligation, accumulated benefit obligation and fair value of plan assets for pension plans with an accumulated benefit obligation in excess of plan assets were as follows:

	Pension Plans
	2012		2011
In millions
Projected benefit obligation, end of year	$	223.5	$	227.2
Accumulated benefit obligation, end of year	$	212.5	$	216.2
Fair value of plan assets, end of year	$	171.8	$	176.0

We estimate that the future benefits payable for the pension and other post-retirement plans are as follows:

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	Pension Plans		Health Care and Other Plans
In millions
2013	$	18.4	$	1.4
2014	$	12.2	$	1.6
2015	$	12.0	$	1.5
2016	$	12.5	$	1.4
2017	$	12.3	$	1.4
2018-2022	$	61.4	$	6.5

Defined Contribution Plans

We sponsor a defined contribution plan under Section 401(k) of the Internal Revenue Code covering all U.S. salaried and hourly employees, and a defined contribution plan in Taiwan covering most salaried and hourly employees of our Taiwan subsidiary. Our costs included in our consolidated statement of operations totaled $9.1 million, $9.4 million and $6.1 million for 2012, 2011 and 2010, respectively.

Other Employee-Related Liabilities

Employees of our subsidiaries in Italy and Korea are covered by an end of service entitlement that provides payment upon termination of employment. Contributions to these plans are based on statutory requirements and are not actuarially determined. The accrued liability was $21.6 million at December 31, 2012 and $20.9 million at December 31, 2011, and is included in other long-term liabilities and accrued liabilities on our balance sheet. The accrued liability is based on the vested benefits to which the employee is entitled assuming employee termination at the measurement date.

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16. VARIABLE INTEREST ENTITIES

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

The carrying amounts and classification of our consolidated VIEs’ assets and liabilities included in our consolidated balance sheet are as follows:

	As of December 31,
	2012			2011
In millions
Current assets	$	10.3		$	3.6
Noncurrent assets	56.2			62.7
Total assets	$	66.5		$	66.3
Current liabilities	$	(8.5	)	$	(10.9	)
Noncurrent liabilities	(69.6		)	(57.4		)
Total liabilities	$	(78.1	)	$	(68.3	)

The amounts shown in the table above exclude intercompany balances which are eliminated upon consolidation. All of the assets in the table above are restricted for settlement of the VIE obligations, and all of the liabilities in the table above can only be settled using VIE resources. The company has not identified any material VIEs during the year ended December 31, 2012, for which we determined that we are not the primary beneficiary and thus did not consolidate.

17. REVENUE AND PROFIT DEFERRALS

	As of December 31,
	2012		2011
In millions
Deferred revenue and profit for solar energy systems:
Short-term profit deferrals and deposits on solar energy system sales	$	113.1	$	41.4
Long-term profit deferrals and deposits on solar energy system sales	126.4		138.0
Deferred subsidy revenue	19.6		19.4
Total solar energy system deferred revenue	$	259.1	$	198.8
Non-solar energy system deferred revenue:
Short-term deferred revenue	$	—	$	0.7
Long-term deferred revenue	29.2		51.2
Total non-solar energy system deferred revenue	$	29.2	$	51.9
Total deferred revenue	$	288.3	$	250.7

Solar Energy System Deferred Revenue

Our Solar Energy segment deferred revenue includes profit deferrals for performance guarantees on systems sold during 2012 and prior periods subject to real estate accounting, customer deposits received for solar energy systems under development, and deferred incentive subsidies that will be amortized over the depreciable life of the system. Profit deferrals for performance guarantees include system production guarantees that generally expire within two years of the system sale date and system uptime guarantees that generally expire during the final years of the system service contract term, which can extend up to twenty years. During the quarter ended December 31, 2012, we recognized revenue of $54.4 million related to profit deferrals on a power guarantee that expired on a 70MW project in Italy that was sold in the fourth quarter of 2010.

In addition to the deferred revenue above, SunEdison may receive upfront incentives or subsidies from various state governmental jurisdictions that are deferred and recognized on a straight-line basis over the depreciable life of the related solar energy system. During 2012, SunEdison received $1.0 million in upfront incentive payments and recognized $0.9 million as revenue.

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Non Solar Energy System Deferred Revenue

In connection with our long-term solar wafer supply agreements executed during 2006 and subsequent amendments, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements. In addition, we have received upfront non-refundable customer deposits upon execution of certain take-or-pay contracts which are deferred and amortized against future purchases. These deposits will be recognized in earnings as we fulfill future customer purchase orders, for which the timing of such orders is not contractually fixed or specified.

During the second quarter of 2011, we resolved our long-term solar wafer supply agreement with Suntech. The consideration was comprised of the retention by MEMC of $53.0 million of cash previously deposited by Suntech under the supply agreement and held by MEMC at the time of the resolution, and a commitment to pay $67.0 million, which has been paid. Also, MEMC has retained the Suntech warrant originally issued to MEMC in July 2006, which had a related unamortized balance recorded in deferred revenues of $56.4 million prior to the resolution of the long-term solar wafer supply agreement. These three components totaled $176.4 million, of which $149.4 million, $19.4 million and $6.9 million was recorded during the second, third and fourth quarter of 2011, respectively. The remaining $0.7 million was deferred as of December 31, 2011 and was recognized as revenue in the first quarter of 2012.

During the third quarter of 2012, we agreed to terminate a long-term solar wafer supply agreement with Conergy AG. Under the terms of the supply agreement, we were to supply to Conergy solar grade silicon wafers over a ten-year period at pre-determined pricing for certain volumes on a take-or-pay basis. Conergy had agreed to advance funds to us in the form of both refundable and non-refundable deposits pursuant to the agreement. As part of the termination agreement with Conergy, we returned $21.3 million of the deposits and collected $21.2 million under an existing letter of credit established by Conergy in our favor. We expect payment of another $5.5 million, which is secured by a letter of credit, plus interest, that relates to the outstanding payables due to us as of December 31, 2012. In addition, Conergy assigned to us certain operations and maintenance service agreements for solar projects in Germany, Italy and Spain or the option to receive $3.0 million in cash. This assignment is subject to our due diligence. We recognized $37.1 million as revenue during the third quarter 2012 due to the fact that we were relieved of our future performance obligations under the agreement. The retention of the deposit, which was previously reflected as a liability, in satisfaction of the take or pay requirement has been classified as an operating cash inflow in the statement of cash flows.

18. FAIR VALUE MEASUREMENTS

The following table summarizes the financial instruments measured at fair value on a recurring basis classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation in the accompanying consolidated balance sheets:

	As of December 31, 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	$	—		$	13.4		$	—		$	13.4		$	—	$	16.2		$	—		$	16.2
Suntech warrant	—			—			0.2			0.2			—		—			0.4			0.4
Interest rate swaps and option thereon	—			(5.0		)	—			(5.0		)	—		(5.6		)	—			(5.6		)
Currency forward contracts	(6.6		)	—			—			(6.6		)	1.2		—			—			1.2
Contingent consideration related to acquisitions	—			—			(24.9		)	(24.9		)	—		—			(90.8		)	(90.8		)
Total	$	(6.6	)	$	8.4		$	(24.7	)	$	(22.9	)	$	1.2	$	10.6		$	(90.4	)	$	(78.6	)

We acquired less than 10% of the common stock of Gintech at the same time as the execution of a long-term supply agreement with that customer. This investment is accounted for at fair value and is classified as a long-term available-for-sale investment.

The Suntech warrant consists of a fully vested, non-forfeitable warrant to purchase common shares of Suntech, a customer, which was received at the time that MEMC signed a long-term supply agreement with Suntech. We use a lattice model to determine the fair value of the Suntech warrant. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. The Suntech warrant is considered a derivative and, accordingly, changes in

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the value of the Suntech warrant are recorded in non-operating expense (income). The notional amount of the warrant was $205.8 million as of December 31, 2012 and 2011.

Our interest rate swaps are considered over the counter derivatives, and fair value is calculated using a present value model with contractual terms for maturities, amortization and interest rates. Level 2, or market observable inputs, such as yield and credit curves are used within the present value models in order to determine fair value.

The fair value of our currency forward contracts is measured by the amount that would have been paid to liquidate and repurchase all open contracts and was a liability of $6.6 million at December 31, 2012, an asset of $1.2 million at December 31, 2011. See Note 5 for additional discussion.

We have estimated the fair value of the contingent consideration outstanding as of December 31, 2012 related to acquisitions at $24.9 million, which reflects a discount at a credit adjusted interest rate for the period of the contingency. That measure is based on significant inputs that are not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions include (i) a discount rate and (ii) a probability adjustment related to the entities' ability to meet operational metrics. See Note 19 for additional discussion.

There were no transfers into or out of Level 1 and Level 2 financial instruments during the year ended December 31, 2012. During the year ended December 31, 2011, there was a transfer into Level 1 of $80.2 million for the SunEdison contingent consideration as of December 31, 2010, because the fair value of the stock issued was based on the closing price of our stock, which is actively traded and considered a Level 1 input. No other transfers into or out of Level 1 and Level 2 financial instruments occurred during the year ended December 31, 2010. The following table summarizes changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended December 31, 2012 and 2011:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
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 (losses) gains included in earnings	(4.8		)	23.2			(1.6		)	16.8
Acquisitions	—			(87.8		)	—			(87.8		)
Balance at December 31, 2011	$	0.4		$	(90.8	)	$	—		$	(90.4	)
Total unrealized gains (losses) included in earnings	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)
Payment of contingent consideration	—			80.9			—			80.9
Balance at December 31, 2012	$	0.2		$	(24.9	)	$	—		$	(24.7	)
The amount of total (losses) gains in 2011 included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held at December 31, 2011	$	(4.8	)	$	23.2		$	(1.6	)	$	16.8
The amount of total losses in 2012 included in earnings attributable to the change in unrealized (losses) gains relating to assets and liabilities still held at December 31, 2012	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)

__________________________

(1) Amounts included in earnings are recorded to non-operating expense (income) in the consolidated statement of operations, except for the amounts for contingent consideration related to acquisitions, for which changes to the fair value were recorded to marketing and administration in the consolidated statement of operations for fair market value adjustments and to interest expense for accretion.

The carrying amount of our outstanding short-term debt, long-term debt and leaseback obligations at December 31, 2012 and 2011 was $2,368.3 million and $1,926.8 million, respectively. The estimated fair value of those obligations was $1,736.2 million and $1,333.6 million at December 31, 2012 and 2011, respectively. Fair value of our debt, excluding our 2019 Notes, is calculated using a discounted cash flow model with consideration for our non-performance risk (Level 3 assumptions). The estimated fair value of our 2019 Notes was based upon a broker quotation. The estimated fair value of our solar energy system debt related to sale-leasebacks is significantly lower than the carrying value of such debt because the fair value estimate is based on the fair value of our fixed lease payments over the term of the leases (Level 3 assumptions). Under real estate

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accounting, this debt is recorded as a financing obligation, and substantially all of our lease payments are recorded as interest expense with little to no reduction in our debt balance over the term of the lease. As a result, our outstanding sale-leaseback debt obligations will generally result in a one-time gain recognition at the end of the leases for the full amount of the debt. The timing difference between expense and gain recognition will result in increased expense during the term of the leases with a significant book gain at the end of the lease.

19. COMMITMENTS AND CONTINGENCIES

Contingent Consideration

Contingent consideration was recorded in connection with the September 2, 2011 acquisition of FRV U.S. The amount payable was based on FRV U.S. achieving certain milestones in the development of specific solar energy systems over a defined time period. On July 6, 2012, contingent consideration related to the acquisition of FRV U.S. was paid in full in the amount of $66.4 million.

Contingent consideration is due to the former Solaicx shareholders if certain operational criteria were met from July 1, 2010 through December 31, 2011. The amount payable is based on Solaicx achieving revenues of at least $60.0 million during such time period, up to a maximum revenue target of $71.8 million, with the payout on a linear basis between those two amounts. This would entitle the former Solaicx shareholders to receive up to an additional $27.6 million of a combination of cash and MEMC common stock, with the number of shares fixed at the date of the acquisition agreement. The former Solaicx shareholders are disputing whether those performance milestones have been met.

Contingent consideration was recorded in connection with three other entities acquired by SunEdison during 2011. The amount payable in cash is based on the entities achieving specific milestones in the development, installation and interconnection of solar energy systems. As of December 31, 2012, the aggregate maximum payouts which could occur under these arrangements is approximately $39.5 million.

During the year ended December 31, 2012, we recorded a $12.8 million charge to income to adjust the fair value of contingent consideration, and during the year ended December 31, 2011 we recorded a favorable adjustment of $26.3 million to adjust the fair value of contingent consideration. These adjustments were based on our revised estimates of operational criteria and project milestones being achieved and were recorded to marketing and administration expense. As of December 31, 2012, a total of $24.9 million is accrued for contingent consideration and the total maximum aggregate exposure is $67.1 million. Of the $24.9 million, $23.1 million is recorded as a short-term liability in contingent consideration related to acquisitions and $1.8 million is recorded in other liabilities as a long-term liability.

Capital Lease Obligations

As more fully described in Note 11, we are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us.

Operating Leases and Purchase Obligations

We lease buildings, equipment and automobiles under operating leases. Rental expense was $23.6 million, $17.6 million and $10.5 million in 2012, 2011 and 2010, respectively. The total future commitments under operating leases as of December 31, 2012 were $96.3 million, of which $90.1 million is noncancellable. Our operating lease obligations as of December 31, 2012 were as follows:

	Payments Due By Period
	Total		2013		2014		2015		2016		2017		Thereafter
In millions
Operating Leases	$	96.3	$	25.3	$	22.2	$	19.8	$	13.3	$	7.3	$	8.4

Purchase Commitments

We recognized charges of $5.5 million during the year ended December 31, 2012, and $37.4 million and $5.7 million during the years ended December 31, 2011 and 2010, respectively, to cost of goods sold related to the estimated probable shortfall to our purchase obligations associated with certain take-or-pay agreements we have with suppliers for raw materials.

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Additionally, as part of our restructuring activities announced in the fourth quarter of 2011, we provided notice to several of our vendors with whom we had long-term supply contracts that we will no longer be fulfilling our purchase obligations under those contracts. During the quarter ended December 31, 2012, one of these vendors filed a notice of arbitration alleging that we failed to comply with our contractual purchase obligations with that vendor.  As of December 31, 2012, we have recorded total accruals of $134.5 million associated with the estimated settlements arising from these purchase obligations with multiple vendors, $69.4 million of which is recorded to short-term accrued liabilities and $65.1 million is recorded as long-term other liabilities in our consolidated balance sheet. The amount accrued as of December 31, 2012 represents our best estimate of the probable amounts to settle all of our purchase obligations based on presently known information, which involve the use of assumptions requiring significant judgment. We estimate the range of reasonably possible losses could be as high as up to approximately $225 million. These estimates include the contractual terms of the agreements, including whether or not there are fixed volumes and/or fixed prices. In addition, under certain contracts, the counterparty may have a contractual obligation to sell the materials to mitigate their losses. We also included in our estimate of losses consideration around whether we believe the obligation will be settled through arbitration, litigation or commercially viable alternative resolutions or settlements. We intend to vigorously defend ourselves against any arbitration or litigation.  Due to the inherent uncertainties of arbitration and litigation, we cannot predict the ultimate outcome or resolution of such actions. The actual amounts ultimately settled with these vendors could vary significantly, which could have a material adverse impact on our business, results of operations and financial condition.

On September 4, 2012 we executed two settlement agreements with Evonik Industries AG and Evonik Degussa SpA ("Evonik"), one of our suppliers, to settle disputes arising from our early termination of two take-or-pay supply agreements. One of the original supply agreements also included a provision for the construction and operation of a chlorosilanes plant located on our existing Merano, Italy site for our benefit. Pursuant to the settlement reached, we will pay Evonik a total of 70.0 million euro, of which 10.0 million euro was paid in the third quarter of 2012 and 15.0 million euro was paid in the fourth quarter of 2012. Pursuant to the settlement reached, the balance will be paid in various installments over the next three quarters. The settlement also required our forfeiture of a $10.2 million deposit with Evonik. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrued liability was made in the third quarter of 2012 resulting in $69.2 million of income within restructuring and impairment on the consolidated statement of operations. Additionally, on December 30, 2012 as part of the settlement with Evonik, we obtained title to a chlorosilanes plant which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

Indemnification

We have agreed to indemnify some of our semiconductor and solar wafer customers against claims of infringement of the intellectual property rights of others in our sales contracts with these customers. Historically, we have not paid any claims under these indemnification obligations, and we do not have any pending indemnification claims as of December 31, 2012.

We generally warrant the operation of our solar energy systems for a period of time. Certain parts and labor warranties from our vendors can be assigned to our customers. Due to the absence of historical material warranty claims and expected future claims, we have not recorded a warranty accrual related to solar energy systems as of December 31, 2012. We may also indemnify our customers for tax credits associated with the systems we construct and sell and then leaseback.

During the year ended December 31, 2012, we made additional payments, net of recoveries, under the terms of the lease agreements to indemnify our sale leaseback customers for approximately $18.4 million for shortfalls in amounts approved by the U.S. Treasury Department related to Grant in Lieu program tax credits. We are working with our sale leaseback customers and the U.S. Treasury Department to recover these shortfalls. We believe additional exposures to such payments are not material to our consolidated financial statements.

In connection with certain contracts to sell solar energy systems directly or as sale-leasebacks, SunEdison has guaranteed the systems' performance for various time periods following the date of interconnection. Also, under separate operations and maintenance services agreements, SunEdison has guaranteed the uptime availability of the systems over the term of the arrangements, which may last 20 years. To the extent there are shortfalls in either of the guarantees, SunEdison is required to indemnify the purchaser up to the guaranteed amount through a cash payment. The maximum losses that SunEdison may be subject to for non-performance are contractually limited by the terms of each executed agreement

Legal Proceedings

We are involved in various legal proceedings which arise in the ordinary course of business. Although it is not possible to predict the outcome of these matters, we believe that the ultimate outcome of these proceedings, individually and in the aggregate, will not have a material adverse effect on our financial position, cash flows or results of operations.

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S.O.I.TEC Silicon on Insulator Technologies S.A. v. MEMC Electronic Materials, Inc.

On May 19, 2008, Soitec and Commissariat A L'Energie Atomique (“CEA”) filed a complaint against MEMC in the U.S. District Court for the District of Delaware (Civil Action No. 08-292) alleging infringement, including willful infringement, by MEMC of three U.S. patents related to silicon-on-insulator technology, and requested damages and an injunction. Soitec and CEA filed an amended complaint on July 21, 2009, adding a fourth, related patent to the lawsuit. MEMC filed a counterclaim against Soitec for infringement of one of MEMC's U.S. patents. The Court bifurcated the case into two phases, a first liability phase, which, to the extent liability is found, will be followed by a second damages phase. In a memorandum opinion dated October 13, 2010, the Court found that all of MEMC's current products and processes do not infringe any valid claim of the four asserted Soitec patents.

The Court held a jury trial from October 25, 2010 to November 2, 2010. After the Court's October 13, 2010 ruling in favor of MEMC, the only remaining claim that Soitec continued to assert at trial was a single patent claim directed against some mono-implant research and development efforts conducted by MEMC approximately five to seven years ago, none of which have occurred since 2006, and none of which are material or relevant to the current operations at MEMC. MEMC continued to assert at trial its counterclaim for infringement of MEMC's patent. On November 2, 2010, the jury found that certain of Soitec's wafers infringed the patent asserted by MEMC at trial. The jury also found that one of the Soitec patent claims was valid. This single patent claim covers MEMC's mono-implant research and development efforts that ended in 2006. On July 13, 2011, the court denied all post trial motions. Soitec subsequently filed an appeal and MEMC filed a cross-appeal. The appeal is now fully briefed in the U.S. Court of Appeals for the Federal Circuit; however, the appeal has been stayed pending en banc review of a jurisdictional question unrelated to the merits of the appeal.  While it is difficult to predict the duration of the stay, it will likely extend for at least three months and could last much longer.  No further developments will occur with the case during the stay. The damages phase of this trial will occur, if at all, after the appeal. We believe that Soitec and CEA's suit against us has no merit, and we are asserting a vigorous defense against these claims, as well as our infringement counterclaim. Although it is not possible to predict the outcome of such matters, we believe that the ultimate outcome of this proceeding will not have a material adverse effect on our financial position, cash flows or results of operations.

Jerry Jones v. MEMC Electronic Materials, Inc., et al.

On December 26, 2008, a putative class action lawsuit was filed in the U.S. District Court for the Eastern District of Missouri by plaintiff, Jerry Jones, purportedly on behalf of all participants in and beneficiaries of MEMC's 401(k) Savings Plan (the "Plan") between September 4, 2007 and December 26, 2008, inclusive. The complaint asserted claims against MEMC and certain of its directors, employees and/or other unnamed fiduciaries of the Plan. The complaint alleges that the defendants breached certain fiduciary duties owed under the Employee Retirement Income Security Act, generally asserting that the defendants failed to make full disclosure to the Plan's participants of the risks of investing in MEMC's stock and that the company's stock should not have been made available as an investment alternative in the Plan. The complaint also alleges that MEMC failed to disclose certain material facts regarding MEMC's operations and performance, which had the effect of artificially inflating MEMC's stock price.

On June 1, 2009, an amended class action complaint was filed by Mr. Jones and another purported participant of the Plan, Manuel Acosta, which raises substantially the same claims and is based on substantially the same allegations as the original complaint. However, the amended complaint changes the period of time covered by the action, purporting to be brought on behalf of beneficiaries of and/or participants in the Plan from June 13, 2008 through the present, inclusive. The amended complaint seeks unspecified monetary damages, including losses the participants and beneficiaries of the Plan allegedly experienced due to their investment through the Plan in MEMC's stock, equitable relief and an award of attorneys' fees. No class has been certified and discovery has not begun. The company and the named directors and employees filed a motion to dismiss the complaint, which was fully briefed by the parties as of October 9, 2009. The parties each subsequently filed notices of supplemental authority and corresponding responses. On March 17, 2010, the court denied the motion to dismiss. The MEMC defendants filed a motion for reconsideration or, in the alternative, certification for interlocutory appeal, which was fully briefed by the parties as of June 16, 2010. The parties each subsequently filed notices of supplemental authority and corresponding responses. On October 18, 2010, the court granted the MEMC defendants' motion for reconsideration, vacated its order denying the MEMC defendants' motion to dismiss, and stated that it will revisit the issues raised in the motion to dismiss after the parties supplement their arguments relating thereto. Both parties filed briefs supplementing their arguments on November 1, 2010. On June 28, 2011, plaintiff Jerry Jones filed a notice of voluntary withdrawal from the action. On June 29, 2011, the Court entered an order withdrawing Jones as one of the plaintiffs in this action. The parties each have continued to file additional notices of supplemental authority and responses thereto. On September 27, 2012, the MEMC defendants moved for oral argument on their pending motion to dismiss. Plaintiff Manuel Acosta joined in the MEMC defendants' motion for oral argument on October 9, 2012.  The Court has not ruled on this motion for oral argument. 

87

MEMC believes the above class action is without merit, and we will assert a vigorous defense. Due to the inherent uncertainties of litigation, we cannot predict the ultimate outcome or resolution of the foregoing class action proceedings or estimate the amounts of, or potential range of, loss with respect to these proceedings. An unfavorable outcome could have a material adverse impact on our business, results of operations and financial condition. We have indemnification agreements with each of our present and former directors and officers, under which we are generally required to indemnify each such director or officer against expenses, including attorneys' fees, judgments, fines and settlements, arising from actions such as the lawsuits described above (subject to certain exceptions, as described in the indemnification agreements).

From time to time we may conclude it is in the best interests of our stockholders, employees, vendors and customers to settle one or more litigation matters, and any such settlement could include substantial payments; however, other than as may be noted above, we have not reached this conclusion with respect to any particular matter at this time. There are a variety of factors that influence our decision to settle any particular individual matter, and the amount we may choose to pay or accept as payment to settle such matters, including the strength of our case, developments in the litigation (both expected and unexpected), the behavior of other interested parties, including non-parties to the matter, the demand on management time and the possible distraction of our employees associated with the case and/or the possibility that we may be subject to an injunction or other equitable remedy. It is difficult to predict whether a settlement is possible, the amount of an appropriate settlement or when is the opportune time to settle a matter in light of the numerous factors that go into the settlement decision.

20. REPORTABLE SEGMENTS

From January 1, 2010 until December 31, 2011, MEMC was organized by end market, with three business segments: Semiconductor Materials, Solar Materials, and Solar Energy. During the fourth quarter of 2011, we initiated a large scale global restructuring plan across all of our reportable segments (see Note 3). As part of our restructuring plan, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date we have been engaged in two reportable segments, Semiconductor Materials and Solar Energy.

MEMC’s Semiconductor Materials segment includes the development, production and marketing of semiconductor wafers with a wide variety of features satisfying numerous product specifications to meet our customers’ exacting requirements, which wafers are utilized in the manufacture of semiconductor devices.

MEMC's Solar Energy segment provides solar energy services that integrate the design, installation, financing, monitoring, operations and maintenance portions of the downstream solar market to provide a comprehensive solar energy service to our customers. The results of the segment include the operating of, leasing of and sale of solar energy systems and services to customers who purchase renewable energy by delivering solar power to them under long term power purchase arrangements and feed in tariff arrangements. Our Solar Energy segment also manufactures polysilicon, silicon wafers and solar modules to support our downstream solar business, as well as for sale to external customers.

The Chief Operating Decision Maker (“CODM”) is our Chief Executive Officer. The CODM evaluates segment performance based on segment operating profit plus interest expense. In order to determine segment operating profit, standard costs are used as the basis for raw material costs allocated between segments and any related variances are allocated based on usage of those raw materials. MEMC incurs expenses for research and development costs and marketing activities that are not specific to any one segment or allocated to any segments. These costs, as well as general corporate marketing and administration costs, substantially all of our stock compensation expense, research and development administration costs, legal professional services and related costs, and other items are not evaluated by segment and are included in Corporate and other below. Because certain sites include operations, facilities and/or back office functions that are utilized to support our Semiconductor Materials and Solar Energy businesses, we do not have discrete financial information for total assets. Accordingly, the CODM does not consider total assets when analyzing segment performance. The CODM also evaluates the business on several other key operating metrics, including free cash flow.

88

	For the year ended December 31,
In millions	2012			2011			2010
Net sales:
Semiconductor Materials	$	917.5		$	1,023.1		$	992.6
Solar Energy	1,612.4			1,692.4			1,246.6
Consolidated net sales	$	2,529.9		$	2,715.5		$	2,239.2
Operating (loss) income:
Semiconductor Materials	$	(5.0	)	$	(31.1	)	$	68.2
Solar Energy	162.2			(1,144.0		)	76.2
Corporate and other	(100.0		)	(125.4		)	(123.3		)
Consolidated operating (loss) income	$	57.2		$	(1,300.5	)	$	21.1
Interest expense:
Semiconductor Materials	$	(1.2	)	$	(1.6	)	$	3.2
Solar Energy	76.5			35.5			25.8
Corporate and other	60.0			43.3			—
Consolidated interest expense	$	135.3		$	77.2		$	29.0
Depreciation and amortization:
Semiconductor Materials	$	121.6		$	124.2		$	108.8
Solar Energy	119.3			102.9			56.0
Corporate and other	6.0			—			—
Consolidated depreciation and amortization	$	246.9		$	227.1		$	164.8
Capital expenditures:
Semiconductor Materials	$	75.1		$	144.6		$	150.4
Solar Energy(1)	401.9			901.4			479.6
Corporate and other	8.9			4.6			2.1
Consolidated capital expenditures	$	485.9		$	1,050.6		$	632.1

____________________   

⁽¹⁾  Consists primarily of construction of solar energy systems of $346.9 million, $598.1 million and $280.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

All Segments

Due to macroeconomic circumstances, which affected all of our segments, in December 2011 we committed to a series of actions that reduced our global workforce, right sized our production capacity and accelerated operating cost cutting measures in 2012. In addition, based on the adverse market conditions, MEMC incurred charges in 2011 associated with the impairment of long-lived assets, impairments of goodwill and certain investments, write-downs of inventory and the realizability of deferred tax assets (see Note 3 for a summary of these charges by reportable segment).

During the second quarter of 2010, we received $11.9 million in net insurance proceeds from our business interruption lost profits claim related to the disruption in production at our Pasadena, Texas facility as a result of Hurricane Ike in 2008. Of this amount, $8.0 million was recorded to our Semiconductor Materials segment and $3.9 million was recorded to our Solar Energy segment. No similar transactions occurred during 2012 or 2011.

Semiconductor Materials

Due to the earthquake in Japan on March 11, 2011, our semiconductor wafer production in Japan was suspended from that time through April 12, 2011. Because of the unplanned downtime and damages to the plant, we recorded $27.2 million as period charges to operating margin in the year ended December 31, 2011, with $15.8 million recorded to cost of goods sold due to the under absorption of costs, inventory adjustments, and asset impairment charges. We had no similar adjustments during the year ended December 31, 2012.

During the year ended December 31, 2012 and December 31, 2011, we recorded insurance recoveries related to the above earthquake charges of $4.0 million and $4.0 million. respectively. We had no similar charges during the year ended December 31, 2010.

89

Solar Energy

During the year ended December 31, 2012, we recognized revenue of $37.1 million for the termination of the Conergy long-term wafer supply agreement. Similarly, during the years ended December 31, 2012 and December 31, 2011, there was $0.7 million and $175.7 million, respectively, of revenue recognized as part of the Suntech wafer supply contract resolution. There was no such revenue in the year ended December 31, 2010.

As discussed in Note 3, we recorded a favorable adjustment of $69.2 million of income related to the settlement of the Evonik take or pay contract as well as a gain of $31.7 million related to the receipt of a manufacturing plant from Evonik. In addition to the above items and other restructuring, impairment, and other charges discussed in Note 3, we recognized charges of $5.5 million during the year ended December 31, 2012 and $37.4 million and $5.7 million during the years ended December 31, 2011 and 2010, respectively, to cost of goods sold related to the estimated probable shortfall to our purchase obligations associated with certain take-or-pay agreements we have with suppliers for raw materials. See Note 19.

Given the deterioration in polysilicon and solar wafer pricing, we recorded a lower of cost or market adjustment on our raw material and finished goods inventory in the Solar Energy segment of approximately $3.4 million and $107.0 million in the years ended December 31, 2012 and December 31, 2011, respectively. No such charges were taken in 2010. See Note 7.

We recorded a goodwill impairment of $440.5 million for the Solar Energy segment in the year ended December 31, 2011 (see Note 3). No such impairments were taken in 2010. No goodwill exists as of December 31, 2012.

Corporate and Other

Approximately $8.6 million of net expenses were recorded in Corporate and other, related to legal cases during the year ended December 31, 2011. No such net expenses were recorded in 2012 or 2010. Because the business decisions resulting in this litigation affected multiple segments, these expenses were recorded to Corporate and other. The remaining portion of expenses recorded to Corporate and other included stock-based compensation expense, general corporate marketing and administration costs, research and development administration costs, legal and tax professional services and related costs, and other personnel costs not reflected in the operating segments.

Geographic Segments

Geographic financial information is as follows:

Net Sales to Customers

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
United States	$	735.3	$	447.5	$	242.8
Foreign	1,794.6		2,268.0		1,996.4
Total	$	2,529.9	$	2,715.5	$	2,239.2

Foreign revenues were derived from sales to the following countries:

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
China	$	82.8	$	598.8	$	415.8
Korea	198.8		237.1		176.9
Taiwan	408.4		530.0		549.4
Italy	234.2		375.6		385.3
Canada	248.6		104.9		4.4
Spain	175.8		42.3		2.0
Other foreign countries	446.0		379.3		462.6
Total	$	1,794.6	$	2,268.0	$	1,996.4

90

Net sales are attributed to countries based on the location of the customer.

Our customers fall into five categories: (i) semiconductor device and solar cell and module manufacturers; (ii) commercial customers, which principally include private equity firms, large, national retail chains and real estate property management firms; (iii) federal, state and municipal governments; (iv) financial institutions, private equity firms and insurance companies; and (v) utilities. Our customers are located in various geographic regions including North America, Europe, and Asia Pacific, and are generally well capitalized. As such, our concentration of credit risk is considered minimal. For our solar energy systems, we typically collect the full sales proceeds upon final close and transfer of the system. Sales to any specific customer did not exceed 10% of consolidated net sales for the year ended December 31, 2012 or December 31, 2011. There were two customers where sales did exceed 10% of consolidated net sales for the year ended December 31, 2010.

Property, plant and equipment, net of accumulated depreciation

	As of December 31,
	2012		2011
Dollars in millions
United States	$	1,510.0	$	975.2
Japan	120.9		165.3
Taiwan	231.7		255.4
Italy	215.9		427.5
Other foreign countries	594.5		569.7
Total	$	2,673.0	$	2,393.1

91

21. CONDENSED CONSOLIDATING FINANCIAL INFORMATION

On March 10, 2011, we issued $550.0 million of 7.75% Senior Notes due April 1, 2019 (the “Original 2019 Notes”). The Original 2019 Notes were sold to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). In connection with the sale of the Original 2019 Notes, MEMC entered into a Registration Rights Agreement with the initial purchasers of the Original 2019 Notes, pursuant to which MEMC and the Subsidiary Guarantors (as defined below) agreed to file a registration statement with respect to an offer to exchange the Original 2019 Notes for a new issue of substantially identical notes registered under the Securities Act (the “Exchange 2019 Notes” and together with the Original 2019 Notes, the “2019 Notes”). The 2019 Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain wholly owned domestic subsidiaries of MEMC (the “Subsidiary Guarantors”).

The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule 3-10(d) of Regulation S-X promulgated under the Securities Act, presents the condensed consolidating financial information separately for:

i. MEMC, as the issuer of the 2019 Notes;

ii. The Subsidiary Guarantors, on a combined basis;

iii. MEMC's other subsidiaries, on a combined basis, which are not guarantors of the 2019 Notes (the “Subsidiary Non-Guarantors”);

iv. Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between or among MEMC, the Subsidiary Guarantors and the Subsidiary Non-Guarantors, (b) eliminate the investments in the MEMC's subsidiaries and (c) record consolidating entries; and

v. MEMC and its subsidiaries on a consolidated basis.

92

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	720.9		$	1,037.5		$	3,035.8		$	(2,264.3	)	$	2,529.9
Cost of goods sold	807.7			987.9			2,606.1			(2,207.4		)	2,194.3
Gross margin	(86.8		)	49.6			429.7			(56.9		)	335.6
Operating expenses:
Marketing and administration	112.4			81.1			112.7			—			306.2
Research and development	49.5			13.8			8.5			—			71.8
Gain on receipt of property, plant and equipment	—			—			(31.7		)	—			(31.7		)
Restructuring (reversals) charges	(2.9		)	2.5			(83.1		)	—			(83.5		)
Long-lived asset impairment charges	18.9			0.7			—			—			19.6
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating (loss) income	(264.7		)	(48.5		)	427.3			(56.9		)	57.2
Non-operating (income) expense:
Interest expense	54.6			6.8			73.9			—			135.3
Interest income	(0.1		)	(0.5		)	(3.0		)	—			(3.6		)
Decline in fair value of warrant	—			—			0.2			—			0.2
Other, net	(58.4		)	(5.9		)	62.7			8.4			6.8
Total non-operating (income) expense	(3.9		)	0.4			133.8			8.4			138.7
(Loss) income before income taxes, investment in subsidiary income (loss) and equity in loss of joint ventures	(260.8		)	(48.9		)	293.5			(65.3		)	(81.5		)
Income tax (benefit) expense	(59.6		)	91.9			57.6			(25.0		)	64.9
(Loss) income before investment in subsidiary income (loss) and equity in loss of joint ventures	(201.2		)	(140.8		)	235.9			(40.3		)	(146.4		)
Investment in subsidiary income (loss)	50.6			(1.5		)	—			(49.1		)	—
Equity in loss of joint ventures, net of tax	—			—			(2.3		)	—			(2.3		)
Net (loss) income	(150.6		)	(142.3		)	233.6			(89.4		)	(148.7		)
Net income attributable to noncontrolling interests	—			(0.7		)	(1.2		)	—			(1.9		)
Net (loss) income attributable to MEMC stockholders	$	(150.6	)	$	(143.0	)	$	232.4		$	(89.4	)	$	(150.6	)

93

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	872.7		$	971.9		$	3,692.8		$	(2,821.9	)	$	2,715.5
Cost of goods sold	914.2			884.5			3,312.0			(2,690.1		)	2,420.6
Gross profit	(41.5		)	87.4			380.8			(131.8		)	294.9
Operating expenses:
Marketing and administration	138.3			78.8			135.7			—			352.8
Research and development	60.9			10.7			15.9			—			87.5
Goodwill impairment charges	—			430.8			9.7			—			440.5
Restructuring charges	8.2			6.7			335.8			—			350.7
Long-lived asset impairment	19.4			42.8			305.7			—			367.9
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating loss	(268.3		)	(482.4		)	(418.0		)	(131.8		)	(1,300.5		)
Non-operating (income) expense:
Interest expense	35.4			7.7			34.1			—			77.2
Interest income	(0.3		)	(0.4		)	(3.8		)	—			(4.5		)
Decline in fair value of warrant	—			—			4.8			—			4.8
Other, net	(142.3		)	(2.4		)	124.2			26.6			6.1
Total non-operating (income) expense	(107.2		)	4.9			159.3			26.6			83.6
Loss before income taxes, investment in subsidiary loss and equity in earnings (loss) of joint ventures	(161.1		)	(487.3		)	(577.3		)	(158.4		)	(1,384.1		)
Income tax expense	16.3			31.0			29.5			(3.7		)	73.1
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(177.4		)	(518.3		)	(606.8		)	(154.7		)	(1,457.2		)
Investment in subsidiary loss	(1,358.6		)	(1,046.2		)	—			2,404.8			—
Equity in earnings (loss) of joint ventures, net of tax	—			0.2			(63.0		)	—			(62.8		)
Net loss	(1,536.0		)	(1,564.3		)	(669.8		)	2,250.1			(1,520.0		)
Net income attributable to noncontrolling interests	—			(0.5		)	(15.5		)	—			(16.0		)
Net loss attributable to MEMC stockholders	$	(1,536.0	)	$	(1,564.8	)	$	(685.3	)	$	2,250.1		$	(1,536.0	)

94

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	829.1		$	468.3		$	2,478.5		$	(1,536.7	)	$	2,239.2
Cost of goods sold	823.3			457.3			2,158.7			(1,537.2		)	1,902.1
Gross profit	5.8			11.0			319.8			0.5			337.1
Operating expenses:
Marketing and administration	122.0			61.2			83.8			—			267.0
Research and development	38.5			6.6			10.5			—			55.6
Restructuring charges	5.3			—			—			—			5.3
Insurance Recovery	—			(11.9		)	—			—			(11.9		)
Operating (loss) income	(160.0		)	(44.9		)	225.5			0.5			21.1
Non-operating (income) expense:
Interest expense	(1.7		)	3.2			30.9			(3.4		)	29.0
Interest income	(0.2		)	(2.7		)	(6.0		)	3.4			(5.5		)
Increase in fair value of warrant	—			—			14.0			—			14.0
Other, net	(44.5		)	1.2			23.4			16.0			(3.9		)
Total non-operating (income) expense	(46.4		)	1.7			62.3			16.0			33.6
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(113.6		)	(46.6		)	163.2			(15.5		)	(12.5		)
Income tax (benefit) expense	(64.6		)	(17.9		)	30.8			(1.6		)	(53.3		)
(Loss) income before investment in subsidiary earnings and equity in loss of joint ventures	(49.0		)	(28.7		)	132.4			(13.9		)	40.8
Investment in subsidiary earnings (loss)	84.9			(14.2		)	—			(70.7		)	—
Equity in (loss) earnings of joint ventures, net of tax	(1.5		)	—			8.7			—			7.2
Net income (loss)	34.4			(42.9		)	141.1			(84.6		)	48.0
Net loss (income) attributable to noncontrolling interests	—			0.3			(13.9		)	—			(13.6		)
Net income (loss) attributable to MEMC stockholders	$	34.4		$	(42.6	)	$	127.2		$	(84.6	)	$	34.4

95

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net (loss) income	$	(150.6	)	$	(142.3	)	$	233.6		$	(89.4	)	$	(148.7	)
Other comprehensive loss, net of tax:
Net translation adjustment	—			—			(18.5		)	—			(18.5		)
Net unrealized loss on available-for-sale securities	—			—			(2.8		)	—			(2.8		)
Loss on hedging instruments	—			—			(0.4		)	—			(0.4		)
Net actuarial loss and prior service credit, net of tax	(11.8		)	—			(0.1		)	—			(11.9		)
Other comprehensive loss, net of tax	(11.8		)	—			(21.8		)	—			(33.6		)
Total comprehensive (loss) income	(162.4		)	(142.3		)	211.8			(89.4		)	(182.3		)
Net income attributable to noncontrolling interests	—			(0.7		)	(1.2		)	—			(1.9		)
Net translation adjustment attributable to noncontrolling interests	—			—			(2.3		)	—			(2.3		)
Comprehensive (loss) income attributable to MEMC stockholders	$	(162.4	)	$	(143.0	)	$	208.3		$	(89.4	)	$	(186.5	)

96

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments		Total
Net loss	$	(1,536.0	)	$	(1,564.3	)	$	(669.8	)	$	2,250.1	$	(1,520.0	)
Other comprehensive loss, net of tax
Net translation adjustment	—			—			(2.5		)	—		(2.5		)
Net unrealized loss on available-for-sale securities	—			—			(24.9		)	—		(24.9		)
Gain on hedging instruments	—			—			7.1			—		7.1
Net actuarial loss and prior service credit, net of tax	(14.0		)	—			(2.0		)	—		(16.0		)
Other comprehensive loss, net of tax	(14.0		)	—			(22.3		)	—		(36.3		)
Total comprehensive loss	(1,550.0		)	(1,564.3		)	(692.1		)	2,250.1		(1,556.3		)
Net income attributable to noncontrolling interests	—			(0.5		)	(15.5		)	—		(16.0		)
Net translation adjustment attributable to noncontrolling interests	—			—			(1.7		)	—		(1.7		)
Comprehensive loss attributable to MEMC stockholders	$	(1,550.0	)	$	(1,564.8	)	$	(709.3	)	$	2,250.1	$	(1,574.0	)

97

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2010

(In millions)

	MEMC, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net income (loss)	$	34.4	$	(42.9	)	$	141.1		$	(84.6	)	$	48.0
Other comprehensive income (loss), net of tax:
Net translation adjustment	—		—			16.2			—			16.2
Net unrealized loss on available-for-sale securities	—		—			(2.9		)	—			(2.9		)
Loss on hedging instruments	—		—			(11.0		)	—			(11.0		)
Net actuarial loss and prior service credit, net of tax	3.9		—			(4.5		)	—			(0.6		)
Other comprehensive income (loss), net of tax	3.9		—			(2.2		)	—			1.7
Total comprehensive income (loss)	38.3		(42.9		)	138.9			(84.6		)	49.7
Net loss (income) attributable to noncontrolling interests	—		0.3			(13.9		)	—			(13.6		)
Net translation adjustment attributable to noncontrolling interests	—		—			(0.6		)	—			(0.6		)
Comprehensive income (loss) attributable to MEMC stockholders	$	38.3	$	(42.6	)	$	124.4		$	(84.6	)	$	35.5

98

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
ASSETS
Current assets:
Cash and cash equivalents	$	65.1	$	60.0	$	447.5	$	—		$	572.6
Restricted cash	—		—		72.4		—			72.4
Accounts receivable, net	62.0		23.7		134.7		—			220.4
Inventories	18.4		70.6		200.0		(41.2		)	247.8
Solar energy systems held for development and sale	—		0.3		213.7		(80.2		)	133.8
Prepaid and other current assets	24.9		40.1		147.2		—			212.2
Total current assets	170.4		194.7		1,215.5		(121.4		)	1,459.2
Investments	7.3		20.4		21.9		—			49.6
Investments in subsidiaries	498.2		564.2		—		(1,062.4		)	—
Property, plant and equipment, net:
Non solar energy systems	57.2		294.4		913.8		(52.3		)	1,213.1
Solar energy systems	—		3.0		1,361.3		95.6			1,459.9
Deferred tax assets, net	—		—		—		—			—
Restricted cash	—		1.7		48.5		—			50.2
Other assets	29.4		44.0		282.0		—			355.4
Intangible assets, net	—		110.9		3.3		—			114.2
Total assets	$	762.5	$	1,233.3	$	3,846.3	$	(1,140.5	)	$	4,701.6

99

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.4		$	—		$	3.4
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	—			0.2			97.6			—			97.8
Accounts payable	11.9			67.0			398.1			—			477.0
Accrued liabilities	32.8			42.5			268.9			—			344.2
Deferred revenue for solar energy systems	—			40.7			72.4			—			113.1
Contingent consideration related to acquisitions	—			23.1			—			—			23.1
Customer and other deposits	10.9			0.4			65.9			—			77.2
Intercompany (receivable) payable and short term notes	(651.0		)	764.3			(113.3		)	—			—
Total current liabilities	(595.4		)	938.2			793.0			—			1,135.8
Long-term debt and capital lease obligations, less current portion	746.1			—			12.6			—			758.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	—			9.8			1,498.6			—			1,508.4
Pension and post-employment liabilities	23.9			—			28.8			—			52.7
Customer and other deposits	87.8			—			96.7			—			184.5
Deferred revenue for solar energy systems	—			45.8			100.2			—			146.0
Deferred revenue for non solar energy systems	—			—			29.2			—			29.2
Long-term intercompany note (receivable) payable	(45.4		)	(96.2		)	141.6			—			—
Other liabilities	(29.8		)	112.0			126.7			—			208.9
Total liabilities	187.2			1,009.6			2,827.4			—			4,024.2
Redeemable noncontrolling interest	—			—			11.3			—			11.3
Total MEMC stockholders’ equity	575.3			223.7			916.8			(1,140.5		)	575.3
Noncontrolling interests	—			—			90.8			—			90.8
Total stockholders’ equity	575.3			223.7			1,007.6			(1,140.5		)	666.1
Total liabilities and stockholders’ equity	$	762.5		$	1,233.3		$	3,846.3		$	(1,140.5	)	$	4,701.6

100

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	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	72.3		315.5			916.4		(50.5		)	1,253.7
Solar energy systems	—		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
Goodwill	—		—			—		—			—
Intangible assets, net	—		145.2			4.0		—			149.2
Total assets	$	769.0	$	671.1		$	3,726.9	$	(285.4	)	$	4,881.6

101

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.7		$	—		$	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback 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 and capital lease obligations, less current portion	550.0			—			17.7			—			567.7
Long-term solar energy system debt, financings and capital leaseback 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
Deferred revenue for non solar energy systems	—			—			51.2			—			51.2
Long-term intercompany note (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

102

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(213.7	)	$	9.4		$	(7.3	)	$	(51.9	)	$	(263.5	)
Cash flows from investing activities:
Capital expenditures	(18.0		)	(19.5		)	(101.5		)	—			(139.0		)
Construction of solar energy systems	—			—			(387.8		)	40.9			(346.9		)
Purchases of cost and equity method investments	(8.2		)	—			(39.6		)	—			(47.8		)
Proceeds from return of (payments to) equity method investments	10.0			—			(4.2		)	—			5.8
Change in restricted cash	—			(1.5		)	8.2			—			6.7
Equity infusions or investments in subsidiaries	(44.0		)	(6.7		)	50.7			—			—
Other	2.0			0.1			(4.4		)	11.0			8.7
Net cash used in investing activities	(58.2		)	(27.6		)	(478.6		)	51.9			(512.5		)
Cash flows from financing activities:
Proceeds from long-term debt	196.0			—			—			—			196.0
Cash paid for contingent consideration	—			(15.1		)	(54.1		)	—			(69.2		)
Proceeds from solar energy system financing and capital lease obligations	—			8.4			895.8			—			904.2
Repayments of solar energy system financing and capital lease obligations	—			(0.5		)	(245.7		)	—			(246.2		)
Net repayments of customer deposits related to long-term supply agreements	—			—			(24.4		)	—			(24.4		)
Principal payments on long-term debt	—			—			(3.6		)	—			(3.6		)
Common stock repurchases	(0.5		)	—			—			—			(0.5		)
Receipts from noncontrolling interest	—			—			50.8			—			50.8
(Repayment of) collection of intercompany debt	(74.4		)	27.1			47.3			—			—
Debt financing fees	(12.7		)	—			(29.6		)	—			(42.3		)
Net cash provided by financing activities	108.4			19.9			636.5			—			764.8
Effect of exchange rate changes on cash and cash equivalents	(0.3		)	—			(1.7		)	—			(2.0		)
Net (decrease) increase in cash and cash equivalents	(163.8		)	1.7			148.9			—			(13.2		)
Cash and cash equivalents at beginning of period	228.9			58.3			298.6			—			585.8
Cash and cash equivalents at end of period	$	65.1		$	60.0		$	447.5		$	—		$	572.6

103

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(216.5	)	$	66.3		$	193.0		$	(58.1	)	$	(15.3	)
Cash flows from investing activities:
Capital expenditures	(24.1		)	(56.4		)	(372.0		)	—			(452.5		)
Construction of solar energy systems	—			—			(627.5		)	29.4			(598.1		)
Purchases of cost and equity method investments	(1.1		)	(5.0		)	(44.3		)	—			(50.4		)
Proceeds from return of equity method investments	82.0			13.7			—			—			95.7
Change in restricted cash	—			0.5			(124.3		)	—			(123.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			(14.4		)	(0.1		)	—			(14.5		)
Proceeds from Property, Plant and Equipment	—			—			43.9			—			43.9
Cash payments for acquisition, net of cash acquired	—			(160.1		)	(3.9		)	—			(164.0		)
Equity infusions or investments in subsidiaries	82.9			2.8			(85.7		)	—			—
Other	5.7			(0.1		)	(33.5		)	28.7			0.8
Net cash provided by (used in) investing activities	145.4			(219.0		)	(1,247.4		)	58.1			(1,262.9		)
Cash flows from financing activities:
Proceeds from long-term debt	550.0			—			—			—			550.0
Proceeds from solar energy system financing and capital lease obligations	—			0.5			1,070.7			—			1,071.2
Cash paid for contingent consideration	—			(50.2		)	—			—			(50.2		)
Repayments of solar energy system financing and capital lease obligations	—			(1.8		)	(264.7		)	—			(266.5		)
Net repayments of customer deposits related to long-term supply agreements	—			(1.8		)	(55.9		)	—			(57.7		)
(Repayment of) collections on intercompany debt	(243.7		)	257.2			(13.5		)	—			—
Principal payments on long-term debt	—			—			(3.7		)	—			(3.7		)
Purchases of and dividends to noncontrolling interest	—			—			(49.0		)	—			(49.0		)
Common stock repurchases	(3.6		)	—			—			—			(3.6		)
Debt financing fees	(18.0		)	—			(21.8		)	—			(39.8		)
Net cash provided by financing activities	284.7			203.9			662.1			—			1,150.7
Effect of exchange rate changes on cash and cash equivalents	(0.2		)	(0.1		)	6.3			—			6.0
Net increase (decrease) in cash and cash equivalents	213.4			51.1			(386.0		)	—			(121.5		)
Cash and cash equivalents at beginning of period	15.5			7.2			684.6			—			707.3
Cash and cash equivalents at end of period	$	228.9		$	58.3		$	298.6		$	—		$	585.8

104

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(128.4	)	$	65.0		$	318.5		$	92.5		$	347.6
Cash flows from investing activities:
Capital expenditures	(25.1		)	(45.7		)	(281.2		)	—			(352.0		)
Construction of solar energy systems	—			(1.4		)	(171.9		)	(106.8		)	(280.1		)
Proceeds from sale and maturities of investments	—			—			185.0			—			185.0
Purchases of cost and equity method investments	—			(10.4		)	(8.4		)	—			(18.8		)
Proceeds from return of equity method investments	85.3			—			—			—			85.3
Change in restricted cash	—			0.3			(2.1		)	—			(1.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			—			(85.0		)	—			(85.0		)
Cash payments for acquisition, net of cash acquired	(75.7		)	2.2			—			—			(73.5		)
Equity infusions or investments in subsidiaries	(30.2		)	1.8			28.4			—			—
Other	30.7			2.9			(28.8		)	14.3			19.1
Net cash used in investing activities	(15.0		)	(50.3		)	(364.0		)	(92.5		)	(521.8		)
Cash flows from financing activities:
Proceeds from solar energy system financing and capital lease obligations	—			1.8			362.6			—			364.4
Repayments of solar energy system financing and capital lease obligations	—			(1.9		)	(59.2		)	—			(61.1		)
Net repayments of customer deposits related to long-term supply agreements	—			(0.4		)	(30.9		)	—			(31.3		)
Collections on (repayment of) intercompany debt	55.9			(55.9		)	—			—			—
Principal payments on long-term debt	—			—			(4.8		)	—			(4.8		)
Purchases of and dividends to noncontrolling interest	—			(0.8		)	(7.5		)	—			(8.3		)
Common stock repurchases	(2.9		)	—			—			—			(2.9		)
Debt financing fees	—			—			(12.8		)	—			(12.8		)
Net cash provided by (used in) financing activities	53.0			(57.2		)	247.4			—			243.2
Effect of exchange rate changes on cash and cash equivalents	—			—			5.6			—			5.6
Net (decrease) increase in cash and cash equivalents	(90.4		)	(42.5		)	207.5			—			74.6
Cash and cash equivalents at beginning of period	105.9			49.7			477.1			—			632.7
Cash and cash equivalents at end of period	$	15.5		$	7.2		$	684.6		$	—		$	707.3

105

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

MEMC Electronic Materials, Inc.:

We have audited the accompanying consolidated balance sheets of MEMC Electronic Materials, Inc. and subsidiaries (the Company) as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2012. We also have audited the Company's internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these consolidated financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed 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. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of MEMC Electronic Materials, Inc. and subsidiaries as of December 31, 2012 and 2011, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2012, in conformity with U.S. generally accepted accounting principles. Also in our opinion, MEMC Electronic Materials, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

106

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for multiple-deliverable arrangements as of January 1, 2011 due to the adoption of Accounting Standards Update 2009-13, Multiple-Deliverable Revenue Arrangements (an amendment to FASB Accounting Standards Codification Topic 605-25).

/s/ KPMG LLP

St. Louis, Missouri

March 1, 2013

107

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation as of December 31, 2012, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of December 31, 2012.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

As of December 31, 2012, management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting based upon the framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework. Based on management’s assessment utilizing these criteria, our management concluded that, as of December 31, 2012, our internal control over financial reporting was effective.

Our independent registered public accounting firm, KPMG, LLP who audited the consolidated financial statements included in this annual report has audited the effectiveness of our internal controls over financial reporting, as stated in its report, which appears in its Report of Independent Registered Public Accounting Firm, above and is incorporated herein by this reference.

Changes in Internal Control Over Financial Reporting

As disclosed in our quarter ended September 30, 2012 Form 10-Q, we identified a control deficiency relating to the design and operation of controls concerning the valuation of our consolidated inventories and solar energy systems held for development and sale. Specifically, we discovered that profit in ending inventory from intercompany solar wafer sales from MEMC Kuching to MEMC Singapore had not been eliminated after sales by MEMC Singapore to certain cell vendors under buy-sell arrangements for conversion to solar modules for use by SunEdison. Under these arrangements, the solar wafers in the solar cells sold by MEMC Singapore to the cell vendors are accounted for as tolling arrangements by MEMC. As a result, the profit from the MEMC Kuching sale to MEMC Singapore must be eliminated until the solar module is sold externally or used in connection with a SunEdison solar energy system that is sold in a direct sale. Our SAP reports were not configured to provide for elimination of profit with non-MEMC entities (i.e., the cell and module vendors) in connection with these arrangements.

We changed our internal control over financial reporting processes surrounding the elimination of profit in ending inventory as of the end of the quarter ended September 30, 2012 to prevent and/or detect potential future errors. The changes in internal controls were as follows:

• We implemented a monthly process to quantify profit in ending inventory outside the SAP system;

• We increased our documentation of inventory assumptions;

• We instituted a process with vendors to identify MEMC Kuching wafer inventory included in our tolling arrangements;

• We imposed an independent review by the director of corporate accounting on a monthly basis; and

• We are in the process of implementing a new consolidations system.

In the fourth quarter of 2012, we undertook and completed, as appropriate, our testing to validate compliance with the newly implemented policies and monthly procedures and controls. We undertook this testing over these monthly and quarterly periods to demonstrate operating effectiveness over a period of time that is sufficient to support our conclusion. We believe these remediation steps addressed the identified control deficiency and has enhanced our internal control over financial reporting, as well as our disclosure controls and procedures. Aside from these changes, there have been no other changes in MEMC's internal control over financial reporting during the quarter ended December 31, 2012 that have materially affected, or are reasonably likely to materially affect, MEMC's internal control over financial reporting.

108

STOCKHOLDERS' INFORMATION

CORPORATE OFFICE

MEMC Electronic Materials, Inc.

501 Pearl Drive (City of O’Fallon)

St. Peters, Missouri 63376

(636) 474-5000

www.memc.com

TRANSFER AGENT AND REGISTRAR

Computershare Investor Services, L.L.C.

2 North LaSalle Street

P.O. Box A3504

Chicago, Illinois 60690-3504

(312) 360-5433

www.computershare.com

STOCKHOLDER INQUIRIES

Inquiries regarding address corrections, lost certificates, changes of registration, stock certificate holdings and other stockholder account matters should be directed to MEMC’s transfer agent, Computershare Investor Services, L.L.C., at the address or phone number above.

COMMON STOCK LISTING

MEMC’s common stock is traded on the New York Stock Exchange under the symbol “WFR”. On December 31, 2012, the Company had 289 stockholders of record.

FORM 10-K

Stockholders may obtain, free of charge, a copy of MEMC’s Annual Report on Form 10-K and related financial statement schedules for the year ended December 31, 2012, filed with the Securities and Exchange Commission, by visiting our website (www.memc.com), by writing MEMC’s Investor Relations Department or by calling (636) 474-5000.

FINANCIAL INFORMATION

MEMC maintains a web page on the Internet at www.memc.com where we publish information, including earnings releases, other news releases and significant corporate disclosures.

CONTACT INFORMATION

All requests and inquiries should be directed to:

Bill Michalek

Director, Corporate Communications

MEMC Electronic Materials, Inc.

501 Pearl Drive

St. Peters, Missouri 63376

Tel: (636) 474-5000

Fax: (636) 474-5158

Email: invest@memc.com

STOCK PRICE PERFORMANCE GRAPH

The graph below compares cumulative total stockholder return with the cumulative total return (assuming reinvestment of dividends) of the S&P 500 Index, the S&P 500 Semiconductors Index and the TAN index. The information on the graph covers

109

the period from December 31, 2007 through December 31, 2012. The stock price performance shown on the graph is not necessarily indicative of future stock price performance. 

Prepared by Standard and Poor’s Capital IQ 2/26/2013

*The TAN index is included from its inception date of 9/16/08

		INDEXED RETURNS
	Base	Years Ending
	Period
Company / Index	12/31/2007	12/31/2008	12/31/2009	12/31/2010	12/31/2011	12/31/2012
MEMC Electronic Materials, Inc.	100	16.14	15.39	12.72	4.45	3.63
S&P 500 Index	100	63.00	79.67	91.68	93.61	108.59
S&P 500 Semiconductors	100	54.26	87.35	97.13	99.31	95.92
TAN Index	100	44.03	51.46	36.79	13.47	9.33

110

EX-21

Exhibit 21

List of Subsidiaries

The following table shows all direct and indirect subsidiaries of the registrant except (1) subsidiaries which, considered in the aggregate as a single subsidiary, do not constitute a significant subsidiary, and (2) certain consolidated wholly-owned multiple subsidiaries carrying on the same line of business, as to which certain summary information appears below.

Subsidiary	Jurisdiction of Incorporation or Organization
Arco Solar 1 LLC	Delaware
AVSR LLC	Delaware
Axio Power Holdings, LLC •  11 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
Cascade Solar II LLC	Delaware
EnFlex Corporation	Delaware
Fotowatio Nevada Solar LLC	Delaware
Fotowatio Renewable Ventures, Inc. •  30 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
Generacion Solar, Spa	Chile
GreenRay, Inc.	Delaware
Hana Hou Solar, LLC	Hawaii
Island Energy Solutions, Inc.	Hawaii
Local Electric Co. Inc.	Oregon
LSF 77, LLC	Delaware
Media Mark Co. Ltd.	Thailand
MEMC Electronic Materials France SarL	France
MEMC Electronic Materials, GmbH	Germany
MEMC Electronic Materials Sales Sdn. Bhd.	Malaysia
MEMC Electronic Materials Sdn. Bhd.	Malaysia
MEMC Electronic Materials, S.p.A.	Italy
MEMC Electronic Materials (UK) Ltd.	United Kingdom
MEMC Enterprise Consulting Shanghai Co. Ltd.	China
MEMC Holding B.V.	The Netherlands
MEMC Holdings Corporation	Delaware
MEMC International Finance SarL	Luxembourg
MEMC International, Inc.	Delaware
MEMC Ipoh Sdn Bhd	Malaysia
MEMC Japan Ltd.	Japan
MEMC Korea Company (80% owned)	South Korea
MEMC Kuching Sdn Bhd	Malaysia
MEMC Luxembourg SarL	Luxembourg
MEMC Pasadena, Inc.	Delaware
MEMC Products Korea Co. Ltd.	South Korea
MEMC Singapore Pte. Ltd.	Singapore
MEMC Solar Services India Private Limited	India
MMA Renewable Ventures Solar Fund III, LLC •  21 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
MMA Solar Fund III GP, Inc.	Delaware
NVT, LLC	Delaware
NVT Licenses, LLC	Delaware
Oro Verde Holdings, LLC •  6 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
Osolar, Ltd.	South Korea
Parsosy Borges Blanques I, S.L. (50% owned)	Spain

Exhibit 21

Subsidiary	Jurisdiction of Incorporation or Organization
Parsosy Juneda, S.L. (50% owned)	Spain
Power Technology International Co., Ltd. (51% owned)	Thailand
Renewable Ventures V Equity Holdings, LLC • 4 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
Renewable Ventures V Construction Holdings, LLC	Delaware
REUT Origination, LLC	Delaware
RV Solar Project GP, LLC • 10 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SE Lakeland II, LLC	Delaware
SE-SIC Ashalim Ltd.	Israel
SEM Solar Power Sdn. Bhd.	Malaysia
SMP Ltd. (50% owned)	Korea
Solaicx	California
SunEdison LLC	Delaware
SunEdison Brazil-Projectos, Montagem e Instalacao de Empreendimentos de Energia Solar Ltda	Brazil
SunEdison Canada, LLC •  39 subsidiaries operating in the provision of solar energy services in Canada	Delaware
SunEdison Chile Construction	Chile
SunEdison Commercial Solutions LLC	Delaware
SunEdison Contracting, LLC	Delaware
SunEdison Duetschland GmbH	Germany
SunEdison Development, LLC	Delaware
SunEdison Energy Holding B.V. (85% owned) •  35 wholly-owned subsidiaries operating in the provision of solar energy services in South Africa	The Netherlands
SunEdison Energy Holdings (Singapore) Ptd. Ltd. (85% owned) •  6 subsidiaries operating in the provision of solar energy services in India	Singapore
SunEdison Energy India Pvt. Ltd. •  18 subsidiaries operating in the provision of solar energy services in India	India
SunEdison Energy South Africa (Pty) Ltd.	South Africa
SunEdison France SAS	France
SunEdison France Construction SAS	France
SunEdison Global Ventures B.V.	The Netherlands
SunEdison Government Solutions LLC •  13 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunEdison Hawaii, LLC	Delaware
SunEdison Hellas S.A.	Greece
SunEdison Holdings II, LLC •  15 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunEdison International, LLC	Delaware
SunEdison Israel Ltd.	Israel
SunEdison Italia S.r.l.	Italy
SunEdison Italia Construction S.r.l.	Italy
SunEdison Japan Corporation •  20 wholly-owned subsidiaries operating in the provision of solar energy services in Japan	Japan
SunEdison Korea Company •  2 wholly-owned subsidiaries operating in the provision of solar energy services in South Korea	South Korea
SunEdison (Malaysia) Solar Operating Sdn Bhd	Malaysia
SunEdison (Malaysia) Operating Sdn Bhd	Malaysia
SunEdison (Malaysia) Solar Operations and Maintenance Sdn Bhd	Malaysia
SunEdison Mena FZE	UAE
SunEdison New Energy Technology (Shanghai) Co. Ltd. •  1 wholly-owned subsidiary operating in the provision of solar energy services in China	China

Exhibit 21

Subsidiary	Jurisdiction of Incorporation or Organization
SunEdison Origination 1, LLC	Delaware
SunEdison Origination 2, LLC	Delaware
SunEdison Origination 3, LLC	Delaware
SunEdison PGE Holdings, LLC	Delaware
SunEdison PGE 1 LLC	Delware
SunEdison Power Canada, Inc. •  35 subsidiaries operating in the provision of solar energy services in Canada	Canada
SunEdison Picture Rocks Managing Member, LLC	Delaware
SunEdison Products, LLC	Delaware
SunEdison Puerto Rico LLC	Puerto Rico
SunEdison Puerto Rico Contracting LLC	Puerto Rico
SunEdison Residential Services, LLC	Delaware
SunEdison Services Inc.	Delaware
SunEdison Solar Holdings 1 (Singapore) Pte. Ltd.	Singapore
SunEdison Solar Holdings 2 (Singapore) Pte. Ltd.	Singapore
SunEdison Solar Holdings 3 (Singapore) Pte. Ltd.	Singapore
SunEdison Solar Holdings 4 (Singapore) Pte. Ltd.	Singapore
SunEdison Spain SLU •  3 wholly-owned subsidiaries operating in the provision of solar energy services in Spain	Spain
SunEdison Spain Construction SLU	Spain
SunEdison Utility Solutions LLC	Delaware
SunE ACQ2, LLC	Delaware
SunE ACQ3, LLC	Delaware
SunE Alamosa 1 LLC	Delaware
SunE Alamosa 1 Holdings, LLC	Delaware
SunE B9 Holdings LLC	Delaware
SunE CBRL1 LLC	Delaware
SunEdison DG Holdings, LLC •  19 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE DM, LLC	Delaware
SunE EPE2 LLC	Delaware
SunE J10 Holdings LLC	Delaware
SunE H4 Holdings LLC	Delaware
SunE MA REC Origination, LLC	Delaware
SunE NLB-1 LLC	Delaware
SunE N7 Holdings LLC	Delaware
SunE NM Land Development LLC	Delaware
SunE NOMAC AD (50% owned)	Bulgaria
SunE Ontario Electric Company, LLC (50% owned)	Delaware
SunE P11A Holdings, LLC	Delaware
SunE P11B Holdings, LLC	Delaware
SunE P11C Holdings, LLC	Delaware
SunE P11D Holdings, LLC	Delaware
SunE P11E Holdings, LLC	Delaware
SunE P11F Holdings, LLC	Delaware
SunE P11G Holdings, LLC	Delaware
SunE P11H Holdings, LLC	Delaware
SunE P11I Holdings, LLC	Delaware
SunE P11J Holdings, LLC	Delaware

Exhibit 21

Subsidiary	Jurisdiction of Incorporation or Organization
SunE P11K Holdings, LLC	Delaware
SunE P11M Holdings, LLC	Delaware
SunE P11N Holdings, LLC	Delaware
SunE P11O Holdings, LLC	Delaware
SunE PGE1 LLC	Delaware
SunE PR Holdings, LLC •  3 wholly-owned subsidiaries operating in the provision of solar energy services in Puerto Rico	Delaware
SunE REC Origination 1, LLC	Delaware
SunE REIT-D PR LLC	Delaware
SunE Residential Holdings LLC	Delaware
SunE Solar Electric Company, LLC (50% owned)	Delaware
SunE Solar BV •  Includes 27 wholly-owned subsidiaries operating in the provision of solar energy services in: Germany (2 subsidiaries) Greece (19 subsidiaries) Italy (6 subsidiaries)	The Netherlands
SunE Solar Fund I, LLC •  21 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar III, LLC •  32 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar IV, LLC	Delaware
SunE Solar V, LLC •  4 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar VI, LLC	Delaware
SunE Solar VII, LLC	Delaware
SunE Solar VIII, LLC •  19 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar VIII, Inc. •  4 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar Construction Holdings LLC	Delaware
SunE Solar Construction, LLC •  17 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
SunE Solar IX, LLC	Delaware
SunE Solar X, LLC	Delaware
SunE Somerset Land, LLC	Delaware
SunE U6 Holdings LLC	Delaware
SunE WF Holdings, LLC •  12 wholly-owned subsidiaries operating in the provision of solar energy services in the U.S.	Delaware
Taisil Electronic Materials Corp.	Taiwan
Taylorsville Solar LLC	Delaware
Team-Solar Inc.	California

EX-23

Exhibit 23

Consent of Independent Registered Public Accounting Firm

The Board of Directors

MEMC Electronic Materials, Inc.:

We consent to the incorporation by reference in the registration statements on Form S-8 (Nos. 333-19159, 333-43474,333-163318, 333-166623, 333-172396 and 333-183550) and on Form S-3 (Nos. 333-176190 and 333-173147) of MEMC Electronic Materials, Inc. of our report dated March 1, 2013, with respect to the consolidated balance sheets of MEMC Electronic Materials, Inc. and subsidiaries as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2012, and the related financial statement schedules, and the effectiveness of internal control over financial reporting as of December 31, 2012, which report appears in the December 31, 2012 annual report on Form 10-K of MEMC Electronic Materials, Inc.

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for multiple-deliverable arrangements as of January 1, 2011 due to the adoption of Accounting Standards Update 2009-13, Multiple-Deliverable Revenue Arrangements (an amendment to FASB Accounting Standards Codification Topic 605-25).

/s/ KPMG LLP

St. Louis, Missouri

March 1, 2013

EX-31.1

Exhibit 31.1

Certification

I, Ahmad R. Chatila, certify that:

1. I have reviewed this annual report on Form 10-K 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s independent registered public accounting firm and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	March 1, 2013	/s/ Ahmad R. Chatila
		Ahmad R. Chatila President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification

I, Brian Wuebbels, certify that:

1. I have reviewed this annual report on Form 10-K 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s independent registered public accounting firm and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	March 1, 2013	/s/ Brian Wuebbels
		Brian Wuebbels Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the annual report of MEMC Electronic Materials, Inc. (the “Company”) on Form 10-K for the period ending December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Ahmad R. Chatila, President and Chief Executive Officer of the Company, and Brian Wuebbels, Executive Vice President and Chief Financial Officer of the Company, certify, to the best of our knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

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.

Date:	March 1, 2013	By:	/s/ Ahmad R. Chatila
		Name: Title:	Ahmad R. Chatila President and Chief Executive Officer MEMC Electronic Materials, Inc.
Date:	March 1, 2013	By:	/s/ Brian Wuebbels
		Name: Title:	Brian Wuebbels Executive Vice President and Chief Financial Officer MEMC Electronic Materials, Inc.

XML

Property, Plant and Equipment (Including Consolidated VIEs) (Tables)

12 Months Ended

Dec. 31, 2012

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment consists of the following:

	As of December 31,
	2012			2011
In millions
Land	$	6.1		$	6.5
Software	31.1			31.2
Buildings and improvements	320.5			404.7
Machinery and equipment	1,605.5			1,470.6
Solar energy systems	1,306.5			896.2
	3,269.7			2,809.2
Less accumulated depreciation	(964.1		)	(851.8		)
	2,305.6			1,957.4
Construction in progress – non solar energy systems	141.4			155.5
Construction in progress – solar energy systems	226.0			280.2
Total property, plant and equipment, net	$	2,673.0		$	2,393.1

XML

Summary of Significant Accounting Policies (Details) (USD $) In Millions, unless otherwise specified					12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2012 Favorable Energy Credits [Member] Y	Dec. 31, 2012 Customer Sales Backlog and Relationships [Member] Y	Dec. 31, 2012 Trade Names [Member] Y	Dec. 31, 2012 Developed Technology Rights [Member] Y	Dec. 31, 2012 Software [Member] Y	Dec. 31, 2012 Building and improvements [Member] Y	Dec. 31, 2012 Machinery and Equipment [Member] Y	Dec. 31, 2012 Solar Energy Systems [Member] Y
Cash and Cash Equivalents, at Carrying Value [Abstract]
Cash	$ 514.5	$ 417.0
Cash Equivalents:
Commercial paper	10.0	10.0
Money market funds	48.1	158.8
Cash and Cash Equivalents, at Carrying Value	$ 572.6	$ 585.8	$ 707.3	$ 632.7
Property, Plant and Equipment [Abstract]
Property, Plant and Equipment, Useful Life, Minimum									3	4	1	23
Property, Plant and Equipment, Useful Life, Maximum									6	60	25	30
Finite-Lived Intangible Assets [Abstract]
Finite-Lived Intangible Assets, Useful Life, Maximum					18	6
Finite-Lived Intangible Assets, Useful Life, Minimum					4	1
Finite-Lived Intangible Assets, Useful Life							15	5

XML

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2012

Fair Value Disclosures [Abstract]

Financial Instruments Measured at Fair Value on Recurring Basis

The following table summarizes the financial instruments measured at fair value on a recurring basis classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation in the accompanying consolidated balance sheets:

	As of December 31, 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	$	—		$	13.4		$	—		$	13.4		$	—	$	16.2		$	—		$	16.2
Suntech warrant	—			—			0.2			0.2			—		—			0.4			0.4
Interest rate swaps and option thereon	—			(5.0		)	—			(5.0		)	—		(5.6		)	—			(5.6		)
Currency forward contracts	(6.6		)	—			—			(6.6		)	1.2		—			—			1.2
Contingent consideration related to acquisitions	—			—			(24.9		)	(24.9		)	—		—			(90.8		)	(90.8		)
Total	$	(6.6	)	$	8.4		$	(24.7	)	$	(22.9	)	$	1.2	$	10.6		$	(90.4	)	$	(78.6	)

Changes in Level 3 Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table summarizes changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended December 31, 2012 and 2011:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
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 (losses) gains included in earnings	(4.8		)	23.2			(1.6		)	16.8
Acquisitions	—			(87.8		)	—			(87.8		)
Balance at December 31, 2011	$	0.4		$	(90.8	)	$	—		$	(90.4	)
Total unrealized gains (losses) included in earnings	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)
Payment of contingent consideration	—			80.9			—			80.9
Balance at December 31, 2012	$	0.2		$	(24.9	)	$	—		$	(24.7	)
The amount of total (losses) gains in 2011 included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held at December 31, 2011	$	(4.8	)	$	23.2		$	(1.6	)	$	16.8
The amount of total losses in 2012 included in earnings attributable to the change in unrealized (losses) gains relating to assets and liabilities still held at December 31, 2012	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)

__________________________

(1) Amounts included in earnings are recorded to non-operating expense (income) in the consolidated statement of operations, except for the amounts for contingent consideration related to acquisitions, for which changes to the fair value were recorded to marketing and administration in the consolidated statement of operations for fair market value adjustments and to interest expense for accretion.

XML

Property, Plant and Equipment (Including Consolidated VIEs) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 2,809.2	$ 3,269.7	$ 2,809.2
Less accumulated depreciation	(851.8)	(964.1)	(851.8)
Property, Plant and Equipment, Net	2,393.1	2,673.0	2,393.1
Assets impairment charges	365.4	20.0	381.7	0
Gain on Receipt of Property Plant and Equipment		31.7	0	0
Land [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	6.5	6.1	6.5
Software [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	31.2	31.1	31.2
Building and improvements [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	404.7	320.5	404.7
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	1,470.6	1,605.5	1,470.6
Solar Energy Systems [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	896.2	1,306.5	896.2
Property, Plant and Equipment, Excluding Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Net	1,957.4	2,305.6	1,957.4
Non-Solar Energy Systems [Member] | Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Net	155.5	141.4	155.5
Solar Energy [Member]
Property, Plant and Equipment [Line Items]
Assets impairment charges	358.0
Solar Energy [Member] | Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Net	280.2	226.0	280.2
Merano Polysilicon Plant [Member]
Property, Plant and Equipment [Line Items]
Assets impairment charges		$ 20.0	$ 354.7

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Summary of Significant Accounting Policies (Supplemental Cash Flow Information) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Supplemental Cash Flow Information [Abstract]
Interest payments (including debt issuance costs), net of amount capitalized	$ 170.9	$ 155.9	$ 22.2
Income taxes paid (refunded), net	40.9	13.7	(9.4)
Accounts payable incurred (relieved) for acquisition of fixed assets, including solar energy systems	49.7	(68.0)	138.7
Debt transferred to and assumed by buyer upon sale of solar energy systems	403.1	104.6	43.3
Conversion of note payable to equity	0	0	27.0
Fair value of assets acquired	0	334.5	65.2
Goodwill	0	97.8	56.4
Liabilities assumed and noncontrolling interests	0	(158.0)	(19.9)
Less: loans prior to acquisition	0	(16.0)	(26.0)
Other Non Cash Consideration for Acqusitions	0	90.7	0
Less: cash acquired	0	(3.6)	(2.2)
Cash paid, net of cash acquired	$ 0	$ 164.0	$ 73.5

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Debt and Capital Lease Obligations (Other Facilities Narrative) (Details) (USD $)	12 Months Ended											0 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Corporate Credit Facility [Member]	Sep. 30, 2012 Corporate Credit Facility [Member]	Sep. 28, 2012 Corporate Credit Facility [Member]	Jun. 30, 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, 2018 Minimum [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 Minimum [Member] Corporate Credit Facility [Member]	May 08, 2012 Minimum [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 Maximum [Member] Corporate Credit Facility [Member]	May 08, 2012 Maximum [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 Eurocurrency [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 Base Rate [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 EBITDA greater than 850 million [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 EBITDA, 600 million to 850 million [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 EBITDA, 400 million to 600 million [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 EBITDA less than 400 million [Member] Corporate Credit Facility [Member]	Dec. 31, 2012 Solar Energy [Member] Construction Financing Revolver [Member]	Sep. 30, 2012 Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2011 Solar Energy [Member] Construction Financing Revolver [Member]	Sep. 29, 2011 Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2012 Solar Energy [Member] Other System Financing [Member]
Debt Instrument [Line Items]
Debt, proceeds collected under sales agreement, current																											$ 17,600,000
Line of Credit Facility, Maximum Borrowing Capacity				400,000,000																			150,000,000	300,000,000		50,000,000
Line of Credit, Term												3 years
Debt Instrument, Basis Spread on Variable Rate																	3.75%	2.75%
Line of Credit Facility, Commitment Fee Percentage				0.50%
Letter Of Credit Fees, Effective Rate				2.75%
Debt Instrument, Expected Liquidity Covenant, Minimum					400,000,000		350,000,000		450,000,000	500,000,000									0	300,000,000	400,000,000	500,000,000
Debt Instrument, Covenant Compliance, EBITDA, Maximum																				850,000,000	600,000,000	400,000,000
Ratio of Indebtedness to Net Capital				1.8									1.0	1.0	2.5	3.0
Debt Instrument, Covenant Compliance, EBITDA, Minimum																				600,000,000
Debt Instruments, Cross Default Clause, Minimum Default Indebtedness Amount				35,000,000
Debt Instrument, Covenant Compliance, Amount in Excess of Variable Minimum Liquidity Amount				350,700,000
Line of Credit Facility, Amount Outstanding				0																			7,400,000		77,200,000
Letters of Credit Outstanding, Amount				121,800,000							173,000,000
Short Term Committed Financing Arrangements Maximum Amount	32,300,000
Short Term Committed Financing Arrangements Unavailable Amount Due to Third Party Letters of Credit	13,500,000
Debt Instrument, Amendment for Convertible or Subordinated Undsecured Debt								250,000,000
Deferred Finance Costs, Gross						2,000,000
Line of Credit Facility, Remaining Borrowing Capacity				278,200,000							227,000,000
Interest Costs, Capitalized During Period	$ 19,900,000	$ 18,100,000	$ 5,100,000

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Condensed Consolidating Financial Information (Schedule of Condensed Consolidating Statement of Operations) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net sales		$ 2,529.9	$ 2,715.5	$ 2,239.2
Cost of goods sold		2,194.3	2,420.6	1,902.1
Gross profit		335.6	294.9	337.1
Marketing and administration		306.2	352.8	267.0
Research and development		71.8	87.5	55.6
Goodwill, Impairment Loss	384.1	0	440.5	0
Goodwill impairment charges		(31.7)	0	0
Restructuring (Reversals) Charges	339.5	(83.5)	350.7	5.3
Tangible Asset Impairment Charges		19.6	367.9	0
Insurance recovery		(4.0)	(4.0)	(11.9)
Operating income (loss)		57.2	(1,300.5)	21.1
Interest expense		135.3	77.2	29.0
Interest income		(3.6)	(4.5)	(5.5)
Decline (increase) in fair value of warrant		0.2	4.8	14.0
Other, net		6.8	6.1	(3.9)
Total non-operating expense		138.7	83.6	33.6
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(81.5)	(1,384.1)	(12.5)
Income tax expense (benefit)		64.9	73.1	(53.3)
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(146.4)	(1,457.2)	40.8
Investment in subsidiary earnings (loss)		0	0	0
Equity in (loss) earnings of joint ventures, net of tax		(2.3)	(62.8)	7.2
Net income (loss)		(148.7)	(1,520.0)	48.0
Net Income (Loss) Attributable to Noncontrolling Interest		(1.9)	(16.0)	(13.6)
Net income (loss) attributable to MEMC stockholders		(150.6)	(1,536.0)	34.4
MEMC, Inc. [Member]
Net sales		720.9	872.7	829.1
Cost of goods sold		807.7	914.2	823.3
Gross profit		(86.8)	(41.5)	5.8
Marketing and administration		112.4	138.3	122.0
Research and development		49.5	60.9	38.5
Goodwill, Impairment Loss			0
Goodwill impairment charges		0
Restructuring (Reversals) Charges		(2.9)	8.2	5.3
Tangible Asset Impairment Charges		18.9	19.4
Insurance recovery		0	0	0
Operating income (loss)		(264.7)	(268.3)	(160.0)
Interest expense		54.6	35.4	(1.7)
Interest income		(0.1)	(0.3)	(0.2)
Decline (increase) in fair value of warrant		0	0	0
Other, net		(58.4)	(142.3)	(44.5)
Total non-operating expense		(3.9)	(107.2)	(46.4)
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(260.8)	(161.1)	(113.6)
Income tax expense (benefit)		(59.6)	16.3	(64.6)
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(201.2)	(177.4)	(49.0)
Investment in subsidiary earnings (loss)		50.6	(1,358.6)	84.9
Equity in (loss) earnings of joint ventures, net of tax		0	0	(1.5)
Net income (loss)		(150.6)	(1,536.0)	34.4
Net Income (Loss) Attributable to Noncontrolling Interest		0	0	0
Net income (loss) attributable to MEMC stockholders		(150.6)	(1,536.0)	34.4
Guarantor Subsidiaries [Member]
Net sales		1,037.5	971.9	468.3
Cost of goods sold		987.9	884.5	457.3
Gross profit		49.6	87.4	11.0
Marketing and administration		81.1	78.8	61.2
Research and development		13.8	10.7	6.6
Goodwill, Impairment Loss			430.8
Goodwill impairment charges		0
Restructuring (Reversals) Charges		2.5	6.7	0
Tangible Asset Impairment Charges		0.7	42.8
Insurance recovery		0	0	(11.9)
Operating income (loss)		(48.5)	(482.4)	(44.9)
Interest expense		6.8	7.7	3.2
Interest income		(0.5)	(0.4)	(2.7)
Decline (increase) in fair value of warrant		0	0	0
Other, net		(5.9)	(2.4)	1.2
Total non-operating expense		0.4	4.9	1.7
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(48.9)	(487.3)	(46.6)
Income tax expense (benefit)		91.9	31.0	(17.9)
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(140.8)	(518.3)	(28.7)
Investment in subsidiary earnings (loss)		(1.5)	(1,046.2)	(14.2)
Equity in (loss) earnings of joint ventures, net of tax		0	0.2	0
Net income (loss)		(142.3)	(1,564.3)	(42.9)
Net Income (Loss) Attributable to Noncontrolling Interest		(0.7)	(0.5)	0.3
Net income (loss) attributable to MEMC stockholders		(143.0)	(1,564.8)	(42.6)
Non-Guarantor Subsidiaries [Member]
Net sales		3,035.8	3,692.8	2,478.5
Cost of goods sold		2,606.1	3,312.0	2,158.7
Gross profit		429.7	380.8	319.8
Marketing and administration		112.7	135.7	83.8
Research and development		8.5	15.9	10.5
Goodwill, Impairment Loss			9.7
Goodwill impairment charges		(31.7)
Restructuring (Reversals) Charges		(83.1)	335.8	0
Tangible Asset Impairment Charges		0	305.7
Insurance recovery		(4.0)	(4.0)	0
Operating income (loss)		427.3	(418.0)	225.5
Interest expense		73.9	34.1	30.9
Interest income		(3.0)	(3.8)	(6.0)
Decline (increase) in fair value of warrant		0.2	4.8	14.0
Other, net		62.7	124.2	23.4
Total non-operating expense		133.8	159.3	62.3
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		293.5	(577.3)	163.2
Income tax expense (benefit)		57.6	29.5	30.8
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		235.9	(606.8)	132.4
Investment in subsidiary earnings (loss)		0	0	0
Equity in (loss) earnings of joint ventures, net of tax		(2.3)	(63.0)	8.7
Net income (loss)		233.6	(669.8)	141.1
Net Income (Loss) Attributable to Noncontrolling Interest		(1.2)	(15.5)	(13.9)
Net income (loss) attributable to MEMC stockholders		232.4	(685.3)	127.2
Consolidation, Eliminations [Member]
Net sales		(2,264.3)	(2,821.9)	(1,536.7)
Cost of goods sold		(2,207.4)	(2,690.1)	(1,537.2)
Gross profit		(56.9)	(131.8)	0.5
Marketing and administration		0	0	0
Research and development		0	0	0
Goodwill, Impairment Loss			0
Goodwill impairment charges		0
Restructuring (Reversals) Charges		0	0	0
Tangible Asset Impairment Charges		0	0
Insurance recovery		0	0	0
Operating income (loss)		(56.9)	(131.8)	0.5
Interest expense		0	0	(3.4)
Interest income		0	0	3.4
Decline (increase) in fair value of warrant		0	0	0
Other, net		8.4	26.6	16.0
Total non-operating expense		8.4	26.6	16.0
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(65.3)	(158.4)	(15.5)
Income tax expense (benefit)		(25.0)	(3.7)	(1.6)
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures		(40.3)	(154.7)	(13.9)
Investment in subsidiary earnings (loss)		(49.1)	2,404.8	(70.7)
Equity in (loss) earnings of joint ventures, net of tax		0	0	0
Net income (loss)		(89.4)	2,250.1	(84.6)
Net Income (Loss) Attributable to Noncontrolling Interest		0	0	0
Net income (loss) attributable to MEMC stockholders		$ (89.4)	$ 2,250.1	$ (84.6)

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Variable Interest Entities (Tables)

12 Months Ended

Dec. 31, 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 consolidated balance sheet are as follows:

	As of December 31,
	2012			2011
In millions
Current assets	$	10.3		$	3.6
Noncurrent assets	56.2			62.7
Total assets	$	66.5		$	66.3
Current liabilities	$	(8.5	)	$	(10.9	)
Noncurrent liabilities	(69.6		)	(57.4		)
Total liabilities	$	(78.1	)	$	(68.3	)

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Restructuring and Impairment Charges (Tables)

12 Months Ended

Dec. 31, 2012

Restructuring Cost and Reserve [Line Items]

Schedule of Significant Restructuring, Impairment and Other Charges

The following is a summary of the charges recorded during the three months ended December 31, 2011:

In millions	Segment
Type of Charge	Semiconductor Materials		Solar Energy		Corporate		Total		Statement of Operations Classification
Restructuring	$	35.6	$	303.0	$	0.9	$	339.5	Restructuring
Long-lived asset impairment (See Note 9)	7.4		358.0		—		365.4		Long-lived asset impairment
Goodwill impairment (See Note 10)	—		384.1		—		384.1		Goodwill impairment
Investment/JV impairment (See Note 6)	—		78.9		—		78.9		Other, net and equity in loss of joint ventures
Inventory adjustments and other (See Note 7)	14.2		82.5		—		96.7		Cost of goods sold

2011 Global Plan [Member]

Restructuring Cost and Reserve [Line Items]

Details of Restructuring Expenses

Details of the 2012 expenses, cash payments and expected costs incurred related to the 2011 Global Plan are set out in the following table:

														As of December 31, 2012
In millions	Accrued January 1, 2012		Year-to-date Restructuring Charges (Reversals)			Cash Payments			Currency			Accrued December 31, 2012		Cumulative Costs Incurred		Total Costs Expected to be Incurred
2011 Global Plan
Severance and Employee Benefits	$	60.2	$	—		$	(27.8	)	$	(0.7	)	$	31.7	$	63.2	$	63.2
Contract Termination	260.0		(93.4		)	(34.3		)	2.2			134.5		164.6		164.6
Other	51.1		(2.1		)	(11.9		)	1.2			38.3		49.7		49.7
Total	$	371.3	$	(95.5	)	$	(74.0	)	$	2.7		$	204.5	$	277.5	$	277.5

2009 U.S. Plan [Member]

Restructuring Cost and Reserve [Line Items]

Details of Restructuring Expenses

Details of 2011 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2011		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2011		As of December 31, 2011
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	16.2	$	(0.2	)	$	(3.4	)	$	12.6	$	18.0	$	18.8
Asset move costs	—		1.7			(1.7		)	—		4.9		20.3
Contract termination	—		2.9			—			2.9		2.9		2.9
Infrastructure costs	—		—			—			—		—		4.0
Total	$	16.2	$	4.4		$	(5.1	)	$	15.5	$	25.8	$	46.0

Details of 2012 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2012		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2012		As of December 31, 2012
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	12.6	$	(2.5	)	$	(7.4	)	$	2.7	$	15.5	$	15.5
Asset move costs	—		—			—			—		4.9		5.2
Contract termination	2.9		—			(2.9		)	—		2.9		2.9
Infrastructure costs	—		4.3			(4.3		)	—		4.3		4.3
Total	$	15.5	$	1.8		$	(14.6	)	$	2.7	$	27.6	$	27.9

Details of 2010 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2010		Year-to-Date Restructuring Charges		Cash Payments			Accrued December 31, 2010		As of December 31, 2010
										Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	15.2	$	2.1	$	(1.1	)	$	16.2	$	18.2	$	21.0
Asset move costs	—		3.2		(3.2		)	—		3.2		20.3
Contract termination	—		—		—			—		—		3.0
Infrastructure costs	—		—		—			—		—		4.0
Total	$	15.2	$	5.3	$	(4.3	)	$	16.2	$	21.4	$	48.3

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Debt and Capital Lease Obligations (Principal Payments on Long-Term Debt) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012		Dec. 31, 2011
Debt Instrument [Line Items]
Minimum Lease Payments, Sale Leaseback Transactions	$ 890.2
Maturities of Long-term Debt [Abstract]
Payments on long-term debt, 2012	64.6	[1]
Payments on long-term debt, 2013	30.8	[1]
Payments on long-term debt, 2014	28.6	[1]
Payments on long-term debt, 2015	51.0	[1]
Payments on long-term debt, 2016	206.7	[1]
Payments on long-term debt, Thereafter	771.2	[1]
Payments on long-term debt, Total	1,152.9	[1]
Solar Energy [Member]
Maturities of Long-term Debt [Abstract]
Other System Financing transactions	119.7		27.6
Solar Energy [Member] | Other System Financing [Member]
Maturities of Long-term Debt [Abstract]
Long-term Debt, Current Maturities	17.6
Long-term Debt, Excluding Current Maturities	$ 102.1

[1] Included in maturities of long-term debt is $119.7 million of maturities relating to other system financing transactions that represent the contract price for solar energy systems under existing sales contracts that contain certain contractual provisions that preclude sale treatment under real estate accounting rules. We account for these transactions as financings of $17.6 million and $102.1 million that will mature upon the expiration of the contractual provisions that preclude sale treatment in years 2015 and thereafter, respectively. These could become payment obligations in the event we default under the executed sales agreement, and the buyer may execute its contractual option to put (sell) the project back to SunEdison for a full refund of the contract price.

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Goodwill and Intangible Assets Changes in Goodwill (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Goodwill [Roll Forward]
Goodwill, beginning balance		$ 0	$ 342.7
Goodwill, Period Increase			97.8
Impairments	(384.1)	0	(440.5)	0
Goodwill, ending balance	0		0	342.7
Solar Energy [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance		0	342.7
Goodwill, Purchase Accounting Adjustments			97.8
Impairments	(384.1)	(440.5)	(440.5)	0
Goodwill, ending balance	$ 0		$ 0	$ 342.7

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Income Taxes (Narrative) (Details) (USD $) In Millions, unless otherwise specified	1 Months Ended	11 Months Ended	12 Months Ended				12 Months Ended						3 Months Ended
	Dec. 31, 2011	Dec. 07, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Jun. 30, 2011	Dec. 31, 2012 Foreign Subsidiaries [Member]	Dec. 31, 2011 Foreign Subsidiaries [Member]	Dec. 31, 2010 Foreign Subsidiaries [Member]	Dec. 31, 2012 Foreign Subsidiaries [Member] Minimum [Member]	Dec. 31, 2012 Foreign Subsidiaries [Member] Maximum [Member]	Dec. 31, 2012 Solar Energy [Member]	Jun. 30, 2011 Domestic Country [Member]
Income Taxes [Line Items]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate			35.00%	35.00%	35.00%
Concessionary Tax Rate On Qualifying Income										0.00%	5.00%
Concessionary Tax Rate On Qualifying Income, Period										5 years	10 years
Income Tax Expense (Benefit)			$ (64.9)	$ (73.1)	$ 53.3		$ 4.6	$ 15.7	$ 15.0
Income Tax Examination, Increase (Decrease) in Liability from Prior Year						29.9
Income Tax Examination, Liability Recorded						31.6
Income Tax Examination, Penalties and Interest Accrued						5.0
Income Tax Examination, Federal Benefit						2.3
Reductions related to settlements with taxing authorities													51.0
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority						15.5
Income Tax Benefit, Undistributed Foreign Earnings	0	(13.4)			2.4
Increase (Decrease) In Income Tax Benefit, Undistributed Foreign Earnings				11.3
Undistributed Earnings of Foreign Subsidiaries	1,031.6		382.7	1,031.6
Unrecognized Tax Benefits Subject To Audit	48.3		53.2	48.3
Unrecognized Tax Benefits, Increases Resulting from Cost Allocations And Taxable Income Adjustments, Foreign Operations			4.7
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense			0.2	0.4
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued	2.1		2.3	2.1
Solar energy systems	366.7		461.9	366.7								461.9
Deferred Tax Assets (Liabilities), Net	107.9		84.9	107.9
Increase Decrease In Deferred Tax Assets Net			23.0
Valuation Allowance, Deferred Tax Asset, Change in Amount			94.8
Deferred Tax Assets, Valuation Allowance	415.7		510.5	415.7
Deferred Tax Assets, Operating Loss Carryforwards, Foreign			$ 6.9

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Restructuring and Impairment Charges (Details of Restructuring Expenses) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Contract Termination [Member]
Restructuring Reserve [Roll Forward]
Accrued, End of period	$ 134.5
Other Restructuring Charges [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	371.3
Year-to-Date Restructuring Charges	(95.5)
Cash Payments	74.0
Accrued, End of period	204.5
Cumulative Costs Incurred	277.5
Total Costs Expected to be Incurred	277.5
Restructuring Reserve, Translation Adjustment	2.7
2009 U.S. Plan [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	15.5	16.2	15.2
Year-to-Date Restructuring Charges	1.8	4.4	5.3
Cash Payments	(14.6)	(5.1)	(4.3)
Accrued, End of period	2.7	15.5	16.2
Cumulative Costs Incurred	27.6	25.8	21.4
Total Costs Expected to be Incurred	27.9	46.0	48.3
2009 U.S. Plan [Member] | Severance and Other Employee Benefits [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	12.6	16.2	15.2
Year-to-Date Restructuring Charges	(2.5)	(0.2)	2.1
Cash Payments	(7.4)	(3.4)	(1.1)
Accrued, End of period	2.7	12.6	16.2
Cumulative Costs Incurred	15.5	18.0	18.2
Total Costs Expected to be Incurred	15.5	18.8	21.0
2009 U.S. Plan [Member] | Asset Move Costs [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	0	0	0
Year-to-Date Restructuring Charges	0	1.7	3.2
Cash Payments	0	(1.7)	(3.2)
Accrued, End of period	0	0	0
Cumulative Costs Incurred	4.9	4.9	3.2
Total Costs Expected to be Incurred	5.2	20.3	20.3
2009 U.S. Plan [Member] | Contract Termination [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	2.9	0	0
Year-to-Date Restructuring Charges	0	2.9	0
Cash Payments	2.9	0	0
Accrued, End of period	0	2.9	0
Cumulative Costs Incurred	2.9	2.9	0
Total Costs Expected to be Incurred	2.9	2.9	3.0
2009 U.S. Plan [Member] | Infrastructure Costs [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	0	0	0
Year-to-Date Restructuring Charges	4.3	0	0
Cash Payments	4.3	0	0
Accrued, End of period	0	0	0
Cumulative Costs Incurred	4.3	0	0
Total Costs Expected to be Incurred	4.3	4.0	4.0
2011 US Plan [Member] [Member] | Severance and Other Employee Benefits [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	60.2
Year-to-Date Restructuring Charges	0
Cash Payments	27.8
Accrued, End of period	31.7
Cumulative Costs Incurred	63.2
Total Costs Expected to be Incurred	63.2
Restructuring Reserve, Translation Adjustment	(0.7)
2011 US Plan [Member] [Member] | Contract Termination [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	260.0
Year-to-Date Restructuring Charges	(93.4)
Cash Payments	34.3
Accrued, End of period	134.5
Cumulative Costs Incurred	164.6
Total Costs Expected to be Incurred	164.6
Restructuring Reserve, Translation Adjustment	2.2
2011 US Plan [Member] [Member] | Other Restructuring Charges [Member]
Restructuring Reserve [Roll Forward]
Accrued, Beginning of period	51.1
Year-to-Date Restructuring Charges	(2.1)
Cash Payments	11.9
Accrued, End of period	38.3
Cumulative Costs Incurred	49.7
Total Costs Expected to be Incurred	49.7
Restructuring Reserve, Translation Adjustment	$ 1.2

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Debt and Capital Lease Obligations (Redemption Prices) (Details)	Dec. 31, 2012
Debt and Capital Lease Obligations [Abstract]
2014	105.813%
2015	103.875%
2016	101.938%
2017 and thereafter	100.00%

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(Loss) Earnings Per Share (Schedule of Calculation of Basic and Diluted (loss) Earnings Per Share) (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended	12 Months Ended
	Sep. 30, 2012	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Earnings Per Share [Abstract]
Net Income (Loss) Attributable to Parent		$ (150.6)	$ (1,536.0)	$ 34.4
Net (loss) income attributable to common stockholders, Basic		(152.2)	(1,536.0)	34.4
Net Income (Loss) Available to Common Stockholders, Diluted		(152.2)	(1,536.0)	34.4
Temporary Equity, Accretion to Redemption Value, Adjustment	(1.6)	(1.6)	0	0
Weighted-average shares outstanding, diluted		230.9	229.9	226.9
Incremental Common Shares Attributable to Share-based Payment Arrangements		0	0	0
Stock Options and RSUs - Diluted				1.2
Common stock related to acquisitions (in shares)		0	0	2.1
Incremental Common Shares Attributable to Contingently Issuable Shares - Basic				$ 0
Total shares, Basic		230.9	229.9	226.9
Total shares, Diluted		230.9	229.9	230.2
(Loss) earnings per share, Basic		$ (0.66)	$ (6.68)	$ 0.15
(Loss) earnings per share, Diluted		$ (0.66)	$ (6.68)	$ 0.15

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Stockholders' Equity (Narrative) (Details) (USD $)	0 Months Ended	1 Months Ended	3 Months Ended	12 Months Ended					1 Months Ended	12 Months Ended										12 Months Ended						0 Months Ended			0 Months Ended	12 Months Ended							0 Months Ended	12 Months Ended
	Jun. 27, 2012	Aug. 17, 2012	Dec. 31, 2012 votes_per_share	Dec. 31, 2012 votes_per_share	Dec. 31, 2011	Dec. 31, 2010	Aug. 20, 2012	Dec. 31, 2012 Stock Compensation Plan [Member]	Aug. 17, 2012 Stock Options [Member]	Dec. 31, 2012 Stock Options [Member] tranche price	Dec. 31, 2011 Stock Options [Member]	Dec. 31, 2010 Stock Options [Member]	Dec. 31, 2012 Stock Options [Member] Maximum [Member]	Dec. 31, 2012 Stock Options [Member] Three Years Vesting Period [Member]	Dec. 31, 2012 Stock Options [Member] Four Years Vesting Period [Member]	Dec. 31, 2012 Stock Options [Member] Five Years Vesting Period [Member]	Dec. 31, 2012 Restricted Stock Units (RSUs) [Member]	Dec. 31, 2011 Restricted Stock Units (RSUs) [Member]	Dec. 31, 2010 Restricted Stock Units (RSUs) [Member]	Dec. 31, 2012 Restricted Stock Units (RSUs) [Member] Director [Member]	Dec. 31, 2012 Restricted Stock Units (RSUs) [Member] Three Years Vesting Period [Member]	Dec. 31, 2012 Restricted Stock Units (RSUs) [Member] Four Years Vesting Period [Member]	Dec. 31, 2012 Restricted Stock Units (RSUs) [Member] Five Years Vesting Period [Member]	Feb. 01, 2011 SunEdison [Member]	Nov. 20, 2009 SunEdison [Member]	Nov. 20, 2009 SunEdison [Member] Restricted Stock Units Under Special Inducement Grant Plan [Member]	Dec. 31, 2012 SunEdison [Member] Restricted Stock Units Under Special Inducement Grant Plan [Member]	Jan. 31, 2011 SunEdison [Member] Restricted Stock Units Under Special Inducement Grant Plan [Member]	Nov. 20, 2009 SunEdison [Member] Restricted Stock Units Under Special Inducement Grant Plan [Member] Management [Member]	Dec. 31, 2012 SunEdison [Member] Restricted Stock Units Under Special Inducement Grant Plan [Member] Management [Member]	Dec. 31, 2012 SunEdison [Member] Special Inducement Grant Plan, Cliff Vesting Award [Member]	Dec. 31, 2011 SunEdison [Member] Special Inducement Grant Plan, Cliff Vesting Award [Member]	Dec. 31, 2010 SunEdison [Member] Special Inducement Grant Plan, Cliff Vesting Award [Member]	Dec. 31, 2012 SunEdison [Member] Special Inducement Grant Plan, Performance Awards [Member]	Dec. 31, 2011 SunEdison [Member] Special Inducement Grant Plan, Performance Awards [Member]	Dec. 31, 2010 SunEdison [Member] Special Inducement Grant Plan, Performance Awards [Member]	Nov. 20, 2009 Common Stock [Member] SunEdison [Member]	Dec. 31, 2012 Treasury Stock [Member]	Jun. 27, 2012 Subsidiaries [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period		6,900,000		6,090,871
Preferred stock, shares authorized			50,000,000	50,000,000	50,000,000
Preferred stock, par value			$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares issued			0	0	0
Preferred Stock, Shares Outstanding			0	0	0
Common stock, par value			$ 0.01	$ 0.01	$ 0.01
Number Of Votes Per Share Of Common Stock			1	1
Dividends, Common Stock, Cash				$ 0
Contingent consideration common stock issued																																					3,800,000
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned																																					45,800,000
Share Price																									$ 12.08
Contingent Consideration Common Stock Issued																								2,100,000
Stock Repurchase Program, Authorized Amount				1,000,000,000
Common stock repurchases (in shares)																																						0
Treasury Stock, Shares, Acquired From Inception																																						9,000,000
Treasury Stock, Value, Acquired, Cost From Inception																																						448,000,000
Shares authorized for future grant under these plans								5,100,000
Stock options vesting period (in years)										one year			10 years	3 years	4 years	5 years				2 years	3 years	4 years	5 years							1 year
Weighted-average grant-date fair value per share of options granted										$ 1.18	$ 5.94	$ 7.04
Total unrecognized compensation cost										36,000,000							18,900,000
Unrecognized compensation cost expected to be recognized over a weighted-average period (in years)										3.4							2
Granted																	1,469,549									1,644,529			584,372
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested, Percentage																											33.00%	34.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Expected To Vest Within Year, Percentage																											33.00%
Stock-based compensation				31,700,000	43,900,000	51,600,000																									0	1,600,000	6,200,000	2,700,000	3,200,000	8,100,000
Weighted-average fair value of restricted stock units per share on the date of grant																	$ 3.06	$ 11.09	$ 14.64
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners																																							15.00%
Temporary Equity, Accretion to Redemption Value			1,600,000
Proceeds from Issuance of Redeemable Noncontrolling Interest, Net	11,400,000
Payments of Stock Issuance Costs	1,400,000
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period									2,000,000
Stock Price							$ 2.77
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures				200,000
Granted (in shares)				16,119,890						9,400,000
Share-based Compensation Arrangement by Share-based Payment Award, Contractual Term										10 years
Share-based Compensation Arrangement by Share-based Payment Award, Number of Tranches Award Vested										3
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting, Number of Price Hurdles										3
Share-based Compensation Arrangement by Share-based Payment Award, Vesting Requirements, Achievement of Price Hurdles, Period										30 days
Performance Grant Hurdle Price 1				$ 7.00
Performance Grant Hurdle Price 2				$ 10.00
Performance Grant Hurdle Price 3				$ 15.00
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Fair Value			$ 11,000,000	$ 11,000,000

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(Loss) Earnings Per Share (Narrative) (Details) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2010
Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	0

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Debt and Capital Lease Obligations (Solar Energy Systems Narrative) (Details) (USD $) In Millions, unless otherwise specified			3 Months Ended											12 Months Ended				12 Months Ended
	Dec. 31, 2012 Solar Energy [Member]	Dec. 31, 2011 Solar Energy [Member]	Jun. 30, 2012 Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2012 Solar Energy [Member] Construction Financing Revolver [Member]	Sep. 30, 2012 Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2011 Solar Energy [Member] Construction Financing Revolver [Member]	Sep. 29, 2011 Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2012 Solar Energy [Member] Finance Obligations Under Sale Leaseback [Member]	Dec. 31, 2012 Solar Energy [Member] Construction and Term Debt [Member]	Dec. 31, 2011 Solar Energy [Member] Construction and Term Debt [Member]	Dec. 31, 2012 Solar Energy [Member] Non Recourse Loan [Member]	Dec. 31, 2012 Solar Energy [Member] Other System Financing [Member]	Dec. 31, 2012 Solar Energy [Member] Italy Projects [Member]	Dec. 31, 2012 SunEdison [Member] Construction Financing Revolver [Member]	Dec. 31, 2012 SunEdison [Member] Construction and Term Debt [Member]	Dec. 31, 2012 SunEdison [Member] Solar Energy [Member]	Dec. 31, 2011 SunEdison [Member] Solar Energy [Member]	Dec. 31, 2012 SunEdison [Member] Solar Energy [Member] Minimum [Member]	Dec. 31, 2012 SunEdisons Subsidiary One [Member]	Dec. 31, 2012 SunEdisons Subsidiary Two [Member]	Sep. 24, 2012 SunEdisons Subsidiary Two [Member]	Dec. 31, 2012 LIBOR [Member] Solar Energy [Member] Construction Financing Revolver [Member]	Dec. 31, 2012 PRIME [Member] SunEdison [Member] Construction Financing Revolver [Member]
Debt Instrument [Line Items]
Non Recourse Debt	$ 1,562.9
Line of Credit, Term														3 years
Line of Credit Facility, Maximum Borrowing Capacity				150.0	300.0		50.0
Line of Credit Facility, Percent Of Outstanding Balance Required To Post Under Covenant Terms				15.00%
Debt Instrument, Basis Spread on Variable Rate																						3.50%	2.50%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage														1.10%
Line of Credit Facility, Amount Outstanding				7.4		77.2
Amortization of Financing Costs			3.9
Debt, Maturity														6 months
Long-term Debt	0	0							271.3	305.8
Long-term Debt, Percentage Bearing Variable Interest, Amount															188.7
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum															3.00%
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum															12.00%
Pledged Assets, Other, Not Separately Reported on Statement of Financial Position								1,105.8							80.5
Less current portion - Solar energy systems									61.3	27.9	24.1
Sales Leaseback Transaction, Capacity																			120.0		52.5
Capital lease obligations																93.3	107.8
Sale Leaseback Transaction Master Lease Agreements Term																25 years		10 years
Sale Leaseback Transaction, Amount Due under Financing Arrangement	1,107.2	837.0																	68.0	26.9
Sale and Lease Back Available Amount																			52.0	25.6
Debt, proceeds collected under sales agreement, current												17.6
Debt, proceeds collected from sales agreement, noncurrent												$ 102.1	$ 39.5

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Goodwill and Intangible Assets (Intangible Assets) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012		Dec. 31, 2011
Intangible Assets [Line Items]
Amortizable intangible assets, Gross Carrying Amount	$ 38.5		$ 40.8
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(20.8)		(15.2)	[1]
Amortizable intangible assets, Net Carrying Amount	17.7		25.6	[1]
Indefinite lived assets, Gross Carrying Amount	144.2		144.8
Indefinite lived assets, Accumulated Amortization or Allocated to Solar Energy System	(47.7)		(21.2)
Indefinite lived assets, Net Carrying Amount	96.5		123.6
Finite-Lived Intangible Assets, Future Amortization Expense [Abstract]
Amortization, 2012	6.9
Amortization, 2013	4.4
Amortization, 2014	1.7
Amortization, 2015	1.2
Amortization, 2016	0.5
In-process Technology [Member]
Intangible Assets [Line Items]
Indefinite lived assets, Gross Carrying Amount	0.9		1.5
Indefinite lived assets, Accumulated Amortization or Allocated to Solar Energy System	0		0
Indefinite lived assets, Net Carrying Amount	0.9		1.5
Power Plant Development Arrangements [Member]
Intangible Assets [Line Items]
Indefinite lived assets, Gross Carrying Amount	143.3		143.3
Indefinite lived assets, Accumulated Amortization or Allocated to Solar Energy System	(47.7)		(21.2)
Indefinite lived assets, Net Carrying Amount	95.6		122.1
Favorable Energy Credits [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	7
Amortizable intangible assets, Gross Carrying Amount	14.2		14.2
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(9.0)		(6.1)
Amortizable intangible assets, Net Carrying Amount	5.2		8.1
Customer Relationships [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	6
Amortizable intangible assets, Gross Carrying Amount	5.7	[1]	5.7	[1]
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(2.4)	[1]	(1.6)
Amortizable intangible assets, Net Carrying Amount	3.3		4.1
Trade Name [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	15
Amortizable intangible assets, Gross Carrying Amount	4.1		4.1
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(0.9)		(0.6)
Amortizable intangible assets, Net Carrying Amount	3.2		3.5
Internally Developed Software [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	4
Amortizable intangible assets, Gross Carrying Amount	1.3		1.7
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(1.3)		(1.0)
Amortizable intangible assets, Net Carrying Amount	0		0.7
Developed Technology [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	5
Amortizable intangible assets, Gross Carrying Amount	12.0	[1]	13.9	[1]
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(6.0)	[1]	(5.5)
Amortizable intangible assets, Net Carrying Amount	6.0		8.4
Noncompete Agreements [Member]
Intangible Assets [Line Items]
Amortizable intangible assets, Weighted-Average Amortization Period	1
Amortizable intangible assets, Gross Carrying Amount	1.2		1.2
Amortizable intangible assets, Accumulated Amortization or Allocated to Solar Energy System	(1.2)		(0.4)
Amortizable intangible assets, Net Carrying Amount	0		0.8
FRV US [Member] | Power Plant Development Arrangements [Member]
Intangible Assets [Line Items]
Acquired Indefinite-lived Intangible Asset, Amount	$ 82.6

[1] These intangibles represent the amounts acquired in the SunEdison, Solaicx and other acquisitions. The useful life for in-process technology will be determined once the research and development process is complete and, at that time, amortization of the asset will begin.

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Variable Interest Entities

12 Months Ended

Dec. 31, 2012

Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net [Abstract]

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

The carrying amounts and classification of our consolidated VIEs’ assets and liabilities included in our consolidated balance sheet are as follows:

	As of December 31,
	2012			2011
In millions
Current assets	$	10.3		$	3.6
Noncurrent assets	56.2			62.7
Total assets	$	66.5		$	66.3
Current liabilities	$	(8.5	)	$	(10.9	)
Noncurrent liabilities	(69.6		)	(57.4		)
Total liabilities	$	(78.1	)	$	(68.3	)

The amounts shown in the table above exclude intercompany balances which are eliminated upon consolidation. All of the assets in the table above are restricted for settlement of the VIE obligations, and all of the liabilities in the table above can only be settled using VIE resources. The company has not identified any material VIEs during the year ended December 31, 2012, for which we determined that we are not the primary beneficiary and thus did not consolidate.

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Reportable Segments (Tables)

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Schedule of Reportable Segments

	For the year ended December 31,
In millions	2012			2011			2010
Net sales:
Semiconductor Materials	$	917.5		$	1,023.1		$	992.6
Solar Energy	1,612.4			1,692.4			1,246.6
Consolidated net sales	$	2,529.9		$	2,715.5		$	2,239.2
Operating (loss) income:
Semiconductor Materials	$	(5.0	)	$	(31.1	)	$	68.2
Solar Energy	162.2			(1,144.0		)	76.2
Corporate and other	(100.0		)	(125.4		)	(123.3		)
Consolidated operating (loss) income	$	57.2		$	(1,300.5	)	$	21.1
Interest expense:
Semiconductor Materials	$	(1.2	)	$	(1.6	)	$	3.2
Solar Energy	76.5			35.5			25.8
Corporate and other	60.0			43.3			—
Consolidated interest expense	$	135.3		$	77.2		$	29.0
Depreciation and amortization:
Semiconductor Materials	$	121.6		$	124.2		$	108.8
Solar Energy	119.3			102.9			56.0
Corporate and other	6.0			—			—
Consolidated depreciation and amortization	$	246.9		$	227.1		$	164.8
Capital expenditures:
Semiconductor Materials	$	75.1		$	144.6		$	150.4
Solar Energy(1)	401.9			901.4			479.6
Corporate and other	8.9			4.6			2.1
Consolidated capital expenditures	$	485.9		$	1,050.6		$	632.1

____________________   

⁽¹⁾  Consists primarily of construction of solar energy systems of $346.9 million, $598.1 million and $280.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas

Net Sales to Customers

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
United States	$	735.3	$	447.5	$	242.8
Foreign	1,794.6		2,268.0		1,996.4
Total	$	2,529.9	$	2,715.5	$	2,239.2

Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area

Foreign revenues were derived from sales to the following countries:

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
China	$	82.8	$	598.8	$	415.8
Korea	198.8		237.1		176.9
Taiwan	408.4		530.0		549.4
Italy	234.2		375.6		385.3
Canada	248.6		104.9		4.4
Spain	175.8		42.3		2.0
Other foreign countries	446.0		379.3		462.6
Total	$	1,794.6	$	2,268.0	$	1,996.4

Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country

Property, plant and equipment, net of accumulated depreciation

	As of December 31,
	2012		2011
Dollars in millions
United States	$	1,510.0	$	975.2
Japan	120.9		165.3
Taiwan	231.7		255.4
Italy	215.9		427.5
Other foreign countries	594.5		569.7
Total	$	2,673.0	$	2,393.1

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Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2012

Stockholders' Equity Note [Abstract]

Outstanding Stock Options

The following table presents information regarding outstanding stock options as of December 31, 2012 and changes during the year then ended with regard to stock options:

	Shares		Weighted- Average Exercise Price		Aggregate Intrinsic Value (in millions)		Weighted- Average Remaining Contractual Life
Beginning of year	17,066,401		$	19.21
Granted *	16,119,890		2.82
Exercised	—		—
Forfeited	(6,090,871	)	11.59
Expired	(5,684,301	)	30.20
End of year	21,411,119		$	6.12	$	7.7	8
Options exercisable at year-end	2,940,515		$	17.50	$	7.5	6

Weighted-Average Assumptions

Our weighted-average assumptions are as follows:

	2012		2011		2010
Risk-free interest rate	0.8	%	1.7	%	1.8	%
Expected stock price volatility	68.1	%	65.7	%	67.0	%
Expected term until exercise (years)	4		4		4
Expected dividends	—	%	—	%	—	%

Outstanding Restricted Stock Units

The following table presents information regarding outstanding restricted stock units as of December 31, 2012 and changes during the year then ended:

	Restricted Stock Units		Aggregate Intrinsic Value (in millions)		Weighted-Average Remaining Contractual Life
Beginning of year	4,692,159
Granted	1,469,549
Converted	(680,611	)
Forfeited	(1,079,329	)
End of year	4,401,768		$	13.7	2

Stock-Based Compensation Expense Allocation

Stock-based compensation expense recorded for the years ended December 31, 2012, 2011 and 2010 was allocated as follows:

	2012		2011		2010
In millions
Cost of goods sold	$	5.9	$	5.9	$	5.7
Marketing and administration	21.7		32.5		40.8
Research and development	3.8		5.0		4.7
Stock-based employee compensation	$	31.4	$	43.4	$	51.2

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Debt and Capital Lease Obligations (Non-Solar System Narrative) (Details) (USD $)	12 Months Ended			0 Months Ended		0 Months Ended				0 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Sep. 28, 2012 Second Lien Credit Agreement [Member]	Dec. 31, 2012 Second Lien Credit Agreement [Member]	Mar. 10, 2011 Senior Notes [Member]	Dec. 31, 2012 SunEdisons Subsidiary One [Member]	Dec. 31, 2012 SunEdisons Subsidiary Two [Member]	Sep. 24, 2012 SunEdisons Subsidiary Two [Member]	Mar. 10, 2011 Minimum [Member] Senior Notes [Member]	Mar. 10, 2011 Maximum [Member] Senior Notes [Member]	Sep. 28, 2012 Eurocurrency [Member] Second Lien Credit Agreement [Member]	Sep. 28, 2012 Base Rate [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 Debt Instrument, Redemption, Period Three [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 Debt Instrument, Redemption, Period Two [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 Debt Instrument, Redemption, Period One [Member] Minimum [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 EBITDA greater than 850 million [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 EBITDA, 600 million to 850 million [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 EBITDA, 400 million to 600 million [Member] Second Lien Credit Agreement [Member]	Sep. 30, 2012 EBITDA, 400 million to 600 million [Member] Second Lien Credit Agreement [Member]	Dec. 31, 2012 EBITDA less than 400 million [Member] Second Lien Credit Agreement [Member]
Debt Instrument [Line Items]
Sales Leaseback Transaction, Capacity							$ 120,000,000		$ 52,500,000
Debt Instrument, Face Amount				200,000,000		550,000,000
Debt Instrument, Interest Rate, Stated Percentage						7.75%
Deferred Finance Costs, Gross				10,800,000		13,800,000
Debt Issuance Costs Amortized Period				5		8 years
Debt Instrument Sold At Fixed Percentage Of Principal Amount						100.00%
Number Of Days, Notice To Redeem Note										30 days	60 days
Debt Instrument Redemption Period						12 months
Senior Notes Redemption Price Percent If Change Of Control						101.00%
Notes Payable	16,000,000	21,400,000
Debt Instrument, Discount Rate				2.00%
Proceeds from Issuance of Long-term Debt	196,000,000	550,000,000	0	196,000,000
Debt Instrument, Interest Rate Floor				1.50%
Debt Instrument, Basis Spread on Variable Rate												9.25%	8.25%
Debt Instrument, Interest Rate, Effective Percentage					10.75%
Debt Instrument, Yield Maintenance Payments, Percentage of Prepaid Principal Amount																3.00%
Debt Instrument, Call Premium, Percentage														1.00%	3.00%
Debt Instrument, Covenant Compliance, Consolidated Leverage Ratio After Report Date, Maximum					3
Debt Instrument, Expected Liquidity Covenant, Minimum																	0	200,000,000		300,000,000	400,000,000
Debt Instrument, Covenant Compliance, EBITDA, Maximum																		850,000,000	600,000,000
Debt Instrument, Covenant Compliance, EBITDA, Minimum																					400,000,000
Sale Leaseback Transaction, Amount Due under Financing Arrangement							68,000,000	26,900,000
Sale and Lease Back Available Amount							$ 52,000,000	$ 25,600,000

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Revenue and Profit Deferrals (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended			3 Months Ended			12 Months Ended			3 Months Ended	12 Months Ended		12 Months Ended		0 Months Ended
	Dec. 31, 2012	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Solar Wafer Supply Agreement [Member]	Sep. 30, 2011 Solar Wafer Supply Agreement [Member]	Jun. 30, 2011 Solar Wafer Supply Agreement [Member]	Dec. 31, 2012 Solar Wafer Supply Agreement [Member]	Mar. 31, 2012 Solar Wafer Supply Agreement [Member]	Dec. 31, 2011 Solar Wafer Supply Agreement [Member]	Jun. 30, 2011 Suntech Warrant [Member]	Dec. 31, 2012 Solar Energy [Member]	Dec. 31, 2011 Solar Energy [Member]	Dec. 31, 2012 Solar Energy [Member] Minimum [Member]	Dec. 31, 2012 Solar Energy [Member] Maximum [Member]	Sep. 25, 2012 Solar Wafer Supply Agreement [Member]	Sep. 30, 2012 Solar Wafer Supply Agreement [Member]
Deferred Revenue Arrangement [Line Items]
Recognition of Deferred Revenue																$ 37.1
Contract Period Terms								10 years
System Production Guarantee Term												2 years
Contract resolution, cash deposit							53.0
Contract Receivable, Due One Year or Less							67.0
Deferred revenue prior to the resolution of long-term solar wafer supply											56.4
Deferred Revenue	288.3	288.3	250.7		175.7			175.7	0.7	176.4		259.1	198.8
Deferred Revenue, Additions												1.0
Deferred revenue recognized	54.4	(73.8)	(67.9)	(13.1)	(6.9)	(19.4)	(149.4)					0.9
System Service Contract Term														0 years	20 years
Payments for Other Deposits																21.3
Proceeds from Other Deposits																21.2
Receivables, Long-term Contracts or Programs																	5.5
Contract Termination, Option to Receive Cash																	$ 3.0

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Inventories (Tables)

12 Months Ended

Dec. 31, 2012

Inventory Disclosure [Abstract]

Inventories

Inventories consist of the following:

	As of December 31,
	2012		2011
In millions
Raw materials and supplies	$	89.1	$	121.6
Goods and work-in-process	109.1		97.7
Finished goods	49.6		102.5
Total inventories	$	247.8	$	321.8

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Nature of Operations Tax Expense (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Tax expense, deferred [Line Items]
Deferred Income Tax Expense (Benefit)	$ (7.5)	$ 45.9	$ (47.1)

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Inventories (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended				12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012 SunEdison [Member]	Dec. 31, 2011 SunEdison [Member]	Dec. 31, 2011 Raw Materials and Supplies [Member]	Dec. 31, 2010 Raw Materials and Supplies [Member]	Dec. 31, 2011 Work In Process [Member]	Dec. 31, 2010 Work In Process [Member]	Dec. 31, 2011 Finished Goods [Member]	Dec. 31, 2010 Finished Goods [Member]	Dec. 31, 2011 Solar Wafers [Member]
Inventory [Line Items]
Inventory, Finished Goods, Net of Reserves	$ 102.5	$ 49.6	$ 102.5									$ 42.8
Inventory, Net	321.8	247.8	321.8	27.3	58.4
Other Inventory, Materials, Supplies and Merchandise under Consignment	28.5	27.7	28.5
Inventory Write-down	96.7	3.4	107.0			53.7	0	30.2	0.4	29.7	2.1
Earthquake charges		$ 0	$ 14.9

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Acquisitions (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Jun. 30, 2011 Solaicx [Member]	Sep. 02, 2011 FRV US [Member]
Business Acquisition, Cost of Acquired Entity [Abstract]
Cash		$ 75.7
Contingent consideration	(24.9)	26.0
Allocation of the purchase price:
Cash and cash equivalents		2.2	1.8
Solar energy system held for development			64.2
Other current assets		11.6	9.0
Property, plant and equipment, net		30.0	23.0
Goodwill		56.4	44.6
Intangible assets		21.0	115.5
Other noncurrent assets		0.4	50.2
Current liabilities		(12.2)	(3.4)
Short-term debt			(32.9)
Long-term debt and capital leases obligations, excluding current portion		(1.3)
Other long-term liabilities		(6.4)	(44.6)
Noncontrolling interests			(39.6)
Total purchase price		$ 101.7	$ 187.8

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Revenue and Profit Deferrals (Tables)

12 Months Ended

Dec. 31, 2012

Deferred Revenue Disclosure [Abstract]

Schedule of Deferred Revenue and Profit

	As of December 31,
	2012		2011
In millions
Deferred revenue and profit for solar energy systems:
Short-term profit deferrals and deposits on solar energy system sales	$	113.1	$	41.4
Long-term profit deferrals and deposits on solar energy system sales	126.4		138.0
Deferred subsidy revenue	19.6		19.4
Total solar energy system deferred revenue	$	259.1	$	198.8
Non-solar energy system deferred revenue:
Short-term deferred revenue	$	—	$	0.7
Long-term deferred revenue	29.2		51.2
Total non-solar energy system deferred revenue	$	29.2	$	51.9
Total deferred revenue	$	288.3	$	250.7

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Comprehensive Income (Loss) (Parentheticals) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax	$ (10.5)	$ 10.5	$ 2.5

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Derivatives and Hedging Instruments (Derivatives and Hedging Activities) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Derivatives Designated as Hedging Instrument [Member] | Net Investment Hedging [Member]
Derivatives, Fair Value [Line Items]
Gain (Losses)	$ 0	$ 0	$ 0
Accrued Liabilities [Member] | Derivatives Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	(5.0)	(4.5)
Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	0	(1.1)
Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Currency Forward Contracts [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	(7.1)	(1.8)
Prepaid and Other Current Assets [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Currency Forward Contracts [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	0.5	3.0
Accumulated Other Comprehensive Income [Member] | Derivatives Designated as Hedging Instrument [Member] | Interest Rate Swaps [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	4.3	3.9
Other Assets [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Suntech Warrant [Member]
Derivatives, Fair Value [Line Items]
Assets (Liabilities or Equity) Fair Value	0.2	0.4
Other Comprehensive Income (Loss) [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Currency Forward Contracts [Member]
Derivatives, Fair Value [Line Items]
Gain (Losses)	9.0	7.4	1.3
Change In Fair Value Of Warrant [Member] | Derivatives Not Designated as Hedging Instrument [Member] | Suntech Warrant [Member]
Derivatives, Fair Value [Line Items]
Gain (Losses)	$ 0.2	$ 4.8	$ 14.0

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(Loss) Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2012

Earnings Per Share [Abstract]

Schedule of Calculation of Basic and Diluted (Loss) Earnings Per Share

In 2012, 2011 and 2010, basic and diluted (loss) earnings per share (EPS) were calculated as follows:

	2012						2011						2010
	Basic			Diluted			Basic			Diluted			Basic		Diluted
In millions, except per share amounts
EPS Numerator:
Net (loss) income attributable to common stockholders	$	(150.6	)	$	(150.6	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
Adjustment of redeemable noncontrolling interest	(1.6		)	(1.6		)	—			—			—		—
Adjusted net (loss) income to common stockholders	$	(152.2	)	$	(152.2	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
EPS Denominator:
Weighted-average shares outstanding	230.9			230.9			229.9			229.9			226.9		226.9
Stock options and restricted stock units	—			—			—			—			—		1.2
Common stock related to acquisitions	—			—			—			—			—		2.1
Total shares	230.9			230.9			229.9			229.9			226.9		230.2
(Loss) earnings per share	$	(0.66	)	$	(0.66	)	$	(6.68	)	$	(6.68	)	$	0.15	$	0.15

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Reportable Segments

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

REPORTABLE SEGMENTS

REPORTABLE SEGMENTS

From January 1, 2010 until December 31, 2011, MEMC was organized by end market, with three business segments: Semiconductor Materials, Solar Materials, and Solar Energy. During the fourth quarter of 2011, we initiated a large scale global restructuring plan across all of our reportable segments (see Note 3). As part of our restructuring plan, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date we have been engaged in two reportable segments, Semiconductor Materials and Solar Energy.

MEMC’s Semiconductor Materials segment includes the development, production and marketing of semiconductor wafers with a wide variety of features satisfying numerous product specifications to meet our customers’ exacting requirements, which wafers are utilized in the manufacture of semiconductor devices.

MEMC's Solar Energy segment provides solar energy services that integrate the design, installation, financing, monitoring, operations and maintenance portions of the downstream solar market to provide a comprehensive solar energy service to our customers. The results of the segment include the operating of, leasing of and sale of solar energy systems and services to customers who purchase renewable energy by delivering solar power to them under long term power purchase arrangements and feed in tariff arrangements. Our Solar Energy segment also manufactures polysilicon, silicon wafers and solar modules to support our downstream solar business, as well as for sale to external customers.

The Chief Operating Decision Maker (“CODM”) is our Chief Executive Officer. The CODM evaluates segment performance based on segment operating profit plus interest expense. In order to determine segment operating profit, standard costs are used as the basis for raw material costs allocated between segments and any related variances are allocated based on usage of those raw materials. MEMC incurs expenses for research and development costs and marketing activities that are not specific to any one segment or allocated to any segments. These costs, as well as general corporate marketing and administration costs, substantially all of our stock compensation expense, research and development administration costs, legal professional services and related costs, and other items are not evaluated by segment and are included in Corporate and other below. Because certain sites include operations, facilities and/or back office functions that are utilized to support our Semiconductor Materials and Solar Energy businesses, we do not have discrete financial information for total assets. Accordingly, the CODM does not consider total assets when analyzing segment performance. The CODM also evaluates the business on several other key operating metrics, including free cash flow.

	For the year ended December 31,
In millions	2012			2011			2010
Net sales:
Semiconductor Materials	$	917.5		$	1,023.1		$	992.6
Solar Energy	1,612.4			1,692.4			1,246.6
Consolidated net sales	$	2,529.9		$	2,715.5		$	2,239.2
Operating (loss) income:
Semiconductor Materials	$	(5.0	)	$	(31.1	)	$	68.2
Solar Energy	162.2			(1,144.0		)	76.2
Corporate and other	(100.0		)	(125.4		)	(123.3		)
Consolidated operating (loss) income	$	57.2		$	(1,300.5	)	$	21.1
Interest expense:
Semiconductor Materials	$	(1.2	)	$	(1.6	)	$	3.2
Solar Energy	76.5			35.5			25.8
Corporate and other	60.0			43.3			—
Consolidated interest expense	$	135.3		$	77.2		$	29.0
Depreciation and amortization:
Semiconductor Materials	$	121.6		$	124.2		$	108.8
Solar Energy	119.3			102.9			56.0
Corporate and other	6.0			—			—
Consolidated depreciation and amortization	$	246.9		$	227.1		$	164.8
Capital expenditures:
Semiconductor Materials	$	75.1		$	144.6		$	150.4
Solar Energy(1)	401.9			901.4			479.6
Corporate and other	8.9			4.6			2.1
Consolidated capital expenditures	$	485.9		$	1,050.6		$	632.1

____________________   

⁽¹⁾  Consists primarily of construction of solar energy systems of $346.9 million, $598.1 million and $280.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

All Segments

Due to macroeconomic circumstances, which affected all of our segments, in December 2011 we committed to a series of actions that reduced our global workforce, right sized our production capacity and accelerated operating cost cutting measures in 2012. In addition, based on the adverse market conditions, MEMC incurred charges in 2011 associated with the impairment of long-lived assets, impairments of goodwill and certain investments, write-downs of inventory and the realizability of deferred tax assets (see Note 3 for a summary of these charges by reportable segment).

During the second quarter of 2010, we received $11.9 million in net insurance proceeds from our business interruption lost profits claim related to the disruption in production at our Pasadena, Texas facility as a result of Hurricane Ike in 2008. Of this amount, $8.0 million was recorded to our Semiconductor Materials segment and $3.9 million was recorded to our Solar Energy segment. No similar transactions occurred during 2012 or 2011.

Semiconductor Materials

Due to the earthquake in Japan on March 11, 2011, our semiconductor wafer production in Japan was suspended from that time through April 12, 2011. Because of the unplanned downtime and damages to the plant, we recorded $27.2 million as period charges to operating margin in the year ended December 31, 2011, with $15.8 million recorded to cost of goods sold due to the under absorption of costs, inventory adjustments, and asset impairment charges. We had no similar adjustments during the year ended December 31, 2012.

During the year ended December 31, 2012 and December 31, 2011, we recorded insurance recoveries related to the above earthquake charges of $4.0 million and $4.0 million. respectively. We had no similar charges during the year ended December 31, 2010.

Solar Energy

During the year ended December 31, 2012, we recognized revenue of $37.1 million for the termination of the Conergy long-term wafer supply agreement. Similarly, during the years ended December 31, 2012 and December 31, 2011, there was $0.7 million and $175.7 million, respectively, of revenue recognized as part of the Suntech wafer supply contract resolution. There was no such revenue in the year ended December 31, 2010.

As discussed in Note 3, we recorded a favorable adjustment of $69.2 million of income related to the settlement of the Evonik take or pay contract as well as a gain of $31.7 million related to the receipt of a manufacturing plant from Evonik. In addition to the above items and other restructuring, impairment, and other charges discussed in Note 3, we recognized charges of $5.5 million during the year ended December 31, 2012 and $37.4 million and $5.7 million during the years ended December 31, 2011 and 2010, respectively, to cost of goods sold related to the estimated probable shortfall to our purchase obligations associated with certain take-or-pay agreements we have with suppliers for raw materials. See Note 19.

Given the deterioration in polysilicon and solar wafer pricing, we recorded a lower of cost or market adjustment on our raw material and finished goods inventory in the Solar Energy segment of approximately $3.4 million and $107.0 million in the years ended December 31, 2012 and December 31, 2011, respectively. No such charges were taken in 2010. See Note 7.

We recorded a goodwill impairment of $440.5 million for the Solar Energy segment in the year ended December 31, 2011 (see Note 3). No such impairments were taken in 2010. No goodwill exists as of December 31, 2012.

Corporate and Other

Approximately $8.6 million of net expenses were recorded in Corporate and other, related to legal cases during the year ended December 31, 2011. No such net expenses were recorded in 2012 or 2010. Because the business decisions resulting in this litigation affected multiple segments, these expenses were recorded to Corporate and other. The remaining portion of expenses recorded to Corporate and other included stock-based compensation expense, general corporate marketing and administration costs, research and development administration costs, legal and tax professional services and related costs, and other personnel costs not reflected in the operating segments.

Geographic Segments

Geographic financial information is as follows:

Net Sales to Customers

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
United States	$	735.3	$	447.5	$	242.8
Foreign	1,794.6		2,268.0		1,996.4
Total	$	2,529.9	$	2,715.5	$	2,239.2

Foreign revenues were derived from sales to the following countries:

	For the year ended December 31,
	2012		2011		2010
Dollars in millions
China	$	82.8	$	598.8	$	415.8
Korea	198.8		237.1		176.9
Taiwan	408.4		530.0		549.4
Italy	234.2		375.6		385.3
Canada	248.6		104.9		4.4
Spain	175.8		42.3		2.0
Other foreign countries	446.0		379.3		462.6
Total	$	1,794.6	$	2,268.0	$	1,996.4

Net sales are attributed to countries based on the location of the customer.

Our customers fall into five categories: (i) semiconductor device and solar cell and module manufacturers; (ii) commercial customers, which principally include private equity firms, large, national retail chains and real estate property management firms; (iii) federal, state and municipal governments; (iv) financial institutions, private equity firms and insurance companies; and (v) utilities. Our customers are located in various geographic regions including North America, Europe, and Asia Pacific, and are generally well capitalized. As such, our concentration of credit risk is considered minimal. For our solar energy systems, we typically collect the full sales proceeds upon final close and transfer of the system. Sales to any specific customer did not exceed 10% of consolidated net sales for the year ended December 31, 2012 or December 31, 2011. There were two customers where sales did exceed 10% of consolidated net sales for the year ended December 31, 2010.

Property, plant and equipment, net of accumulated depreciation

	As of December 31,
	2012		2011
Dollars in millions
United States	$	1,510.0	$	975.2
Japan	120.9		165.3
Taiwan	231.7		255.4
Italy	215.9		427.5
Other foreign countries	594.5		569.7
Total	$	2,673.0	$	2,393.1

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Contingent Consideration

Contingent consideration was recorded in connection with the September 2, 2011 acquisition of FRV U.S. The amount payable was based on FRV U.S. achieving certain milestones in the development of specific solar energy systems over a defined time period. On July 6, 2012, contingent consideration related to the acquisition of FRV U.S. was paid in full in the amount of $66.4 million.

Contingent consideration is due to the former Solaicx shareholders if certain operational criteria were met from July 1, 2010 through December 31, 2011. The amount payable is based on Solaicx achieving revenues of at least $60.0 million during such time period, up to a maximum revenue target of $71.8 million, with the payout on a linear basis between those two amounts. This would entitle the former Solaicx shareholders to receive up to an additional $27.6 million of a combination of cash and MEMC common stock, with the number of shares fixed at the date of the acquisition agreement. The former Solaicx shareholders are disputing whether those performance milestones have been met.

Contingent consideration was recorded in connection with three other entities acquired by SunEdison during 2011. The amount payable in cash is based on the entities achieving specific milestones in the development, installation and interconnection of solar energy systems. As of December 31, 2012, the aggregate maximum payouts which could occur under these arrangements is approximately $39.5 million.

During the year ended December 31, 2012, we recorded a $12.8 million charge to income to adjust the fair value of contingent consideration, and during the year ended December 31, 2011 we recorded a favorable adjustment of $26.3 million to adjust the fair value of contingent consideration. These adjustments were based on our revised estimates of operational criteria and project milestones being achieved and were recorded to marketing and administration expense. As of December 31, 2012, a total of $24.9 million is accrued for contingent consideration and the total maximum aggregate exposure is $67.1 million. Of the $24.9 million, $23.1 million is recorded as a short-term liability in contingent consideration related to acquisitions and $1.8 million is recorded in other liabilities as a long-term liability.

Capital Lease Obligations

As more fully described in Note 11, we are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us.

Operating Leases and Purchase Obligations

We lease buildings, equipment and automobiles under operating leases. Rental expense was $23.6 million, $17.6 million and $10.5 million in 2012, 2011 and 2010, respectively. The total future commitments under operating leases as of December 31, 2012 were $96.3 million, of which $90.1 million is noncancellable. Our operating lease obligations as of December 31, 2012 were as follows:

	Payments Due By Period
	Total		2013		2014		2015		2016		2017		Thereafter
In millions
Operating Leases	$	96.3	$	25.3	$	22.2	$	19.8	$	13.3	$	7.3	$	8.4

Purchase Commitments

We recognized charges of $5.5 million during the year ended December 31, 2012, and $37.4 million and $5.7 million during the years ended December 31, 2011 and 2010, respectively, to cost of goods sold related to the estimated probable shortfall to our purchase obligations associated with certain take-or-pay agreements we have with suppliers for raw materials.

Additionally, as part of our restructuring activities announced in the fourth quarter of 2011, we provided notice to several of our vendors with whom we had long-term supply contracts that we will no longer be fulfilling our purchase obligations under those contracts. During the quarter ended December 31, 2012, one of these vendors filed a notice of arbitration alleging that we failed to comply with our contractual purchase obligations with that vendor.  As of December 31, 2012, we have recorded total accruals of $134.5 million associated with the estimated settlements arising from these purchase obligations with multiple vendors, $69.4 million of which is recorded to short-term accrued liabilities and $65.1 million is recorded as long-term other liabilities in our consolidated balance sheet. The amount accrued as of December 31, 2012 represents our best estimate of the probable amounts to settle all of our purchase obligations based on presently known information, which involve the use of assumptions requiring significant judgment. We estimate the range of reasonably possible losses could be as high as up to approximately $225 million. These estimates include the contractual terms of the agreements, including whether or not there are fixed volumes and/or fixed prices. In addition, under certain contracts, the counterparty may have a contractual obligation to sell the materials to mitigate their losses. We also included in our estimate of losses consideration around whether we believe the obligation will be settled through arbitration, litigation or commercially viable alternative resolutions or settlements. We intend to vigorously defend ourselves against any arbitration or litigation.  Due to the inherent uncertainties of arbitration and litigation, we cannot predict the ultimate outcome or resolution of such actions. The actual amounts ultimately settled with these vendors could vary significantly, which could have a material adverse impact on our business, results of operations and financial condition.

On September 4, 2012 we executed two settlement agreements with Evonik Industries AG and Evonik Degussa SpA ("Evonik"), one of our suppliers, to settle disputes arising from our early termination of two take-or-pay supply agreements. One of the original supply agreements also included a provision for the construction and operation of a chlorosilanes plant located on our existing Merano, Italy site for our benefit. Pursuant to the settlement reached, we will pay Evonik a total of 70.0 million euro, of which 10.0 million euro was paid in the third quarter of 2012 and 15.0 million euro was paid in the fourth quarter of 2012. Pursuant to the settlement reached, the balance will be paid in various installments over the next three quarters. The settlement also required our forfeiture of a $10.2 million deposit with Evonik. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrued liability was made in the third quarter of 2012 resulting in $69.2 million of income within restructuring and impairment on the consolidated statement of operations. Additionally, on December 30, 2012 as part of the settlement with Evonik, we obtained title to a chlorosilanes plant which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

Indemnification

We have agreed to indemnify some of our semiconductor and solar wafer customers against claims of infringement of the intellectual property rights of others in our sales contracts with these customers. Historically, we have not paid any claims under these indemnification obligations, and we do not have any pending indemnification claims as of December 31, 2012.

We generally warrant the operation of our solar energy systems for a period of time. Certain parts and labor warranties from our vendors can be assigned to our customers. Due to the absence of historical material warranty claims and expected future claims, we have not recorded a warranty accrual related to solar energy systems as of December 31, 2012. We may also indemnify our customers for tax credits associated with the systems we construct and sell and then leaseback.

During the year ended December 31, 2012, we made additional payments, net of recoveries, under the terms of the lease agreements to indemnify our sale leaseback customers for approximately $18.4 million for shortfalls in amounts approved by the U.S. Treasury Department related to Grant in Lieu program tax credits. We are working with our sale leaseback customers and the U.S. Treasury Department to recover these shortfalls. We believe additional exposures to such payments are not material to our consolidated financial statements.

In connection with certain contracts to sell solar energy systems directly or as sale-leasebacks, SunEdison has guaranteed the systems' performance for various time periods following the date of interconnection. Also, under separate operations and maintenance services agreements, SunEdison has guaranteed the uptime availability of the systems over the term of the arrangements, which may last 20 years. To the extent there are shortfalls in either of the guarantees, SunEdison is required to indemnify the purchaser up to the guaranteed amount through a cash payment. The maximum losses that SunEdison may be subject to for non-performance are contractually limited by the terms of each executed agreement

Legal Proceedings

We are involved in various legal proceedings which arise in the ordinary course of business. Although it is not possible to predict the outcome of these matters, we believe that the ultimate outcome of these proceedings, individually and in the aggregate, will not have a material adverse effect on our financial position, cash flows or results of operations.

S.O.I.TEC Silicon on Insulator Technologies S.A. v. MEMC Electronic Materials, Inc.

On May 19, 2008, Soitec and Commissariat A L'Energie Atomique (“CEA”) filed a complaint against MEMC in the U.S. District Court for the District of Delaware (Civil Action No. 08-292) alleging infringement, including willful infringement, by MEMC of three U.S. patents related to silicon-on-insulator technology, and requested damages and an injunction. Soitec and CEA filed an amended complaint on July 21, 2009, adding a fourth, related patent to the lawsuit. MEMC filed a counterclaim against Soitec for infringement of one of MEMC's U.S. patents. The Court bifurcated the case into two phases, a first liability phase, which, to the extent liability is found, will be followed by a second damages phase. In a memorandum opinion dated October 13, 2010, the Court found that all of MEMC's current products and processes do not infringe any valid claim of the four asserted Soitec patents.

The Court held a jury trial from October 25, 2010 to November 2, 2010. After the Court's October 13, 2010 ruling in favor of MEMC, the only remaining claim that Soitec continued to assert at trial was a single patent claim directed against some mono-implant research and development efforts conducted by MEMC approximately five to seven years ago, none of which have occurred since 2006, and none of which are material or relevant to the current operations at MEMC. MEMC continued to assert at trial its counterclaim for infringement of MEMC's patent. On November 2, 2010, the jury found that certain of Soitec's wafers infringed the patent asserted by MEMC at trial. The jury also found that one of the Soitec patent claims was valid. This single patent claim covers MEMC's mono-implant research and development efforts that ended in 2006. On July 13, 2011, the court denied all post trial motions. Soitec subsequently filed an appeal and MEMC filed a cross-appeal. The appeal is now fully briefed in the U.S. Court of Appeals for the Federal Circuit; however, the appeal has been stayed pending en banc review of a jurisdictional question unrelated to the merits of the appeal.  While it is difficult to predict the duration of the stay, it will likely extend for at least three months and could last much longer.  No further developments will occur with the case during the stay. The damages phase of this trial will occur, if at all, after the appeal. We believe that Soitec and CEA's suit against us has no merit, and we are asserting a vigorous defense against these claims, as well as our infringement counterclaim. Although it is not possible to predict the outcome of such matters, we believe that the ultimate outcome of this proceeding will not have a material adverse effect on our financial position, cash flows or results of operations.

Jerry Jones v. MEMC Electronic Materials, Inc., et al.

On December 26, 2008, a putative class action lawsuit was filed in the U.S. District Court for the Eastern District of Missouri by plaintiff, Jerry Jones, purportedly on behalf of all participants in and beneficiaries of MEMC's 401(k) Savings Plan (the "Plan") between September 4, 2007 and December 26, 2008, inclusive. The complaint asserted claims against MEMC and certain of its directors, employees and/or other unnamed fiduciaries of the Plan. The complaint alleges that the defendants breached certain fiduciary duties owed under the Employee Retirement Income Security Act, generally asserting that the defendants failed to make full disclosure to the Plan's participants of the risks of investing in MEMC's stock and that the company's stock should not have been made available as an investment alternative in the Plan. The complaint also alleges that MEMC failed to disclose certain material facts regarding MEMC's operations and performance, which had the effect of artificially inflating MEMC's stock price.

On June 1, 2009, an amended class action complaint was filed by Mr. Jones and another purported participant of the Plan, Manuel Acosta, which raises substantially the same claims and is based on substantially the same allegations as the original complaint. However, the amended complaint changes the period of time covered by the action, purporting to be brought on behalf of beneficiaries of and/or participants in the Plan from June 13, 2008 through the present, inclusive. The amended complaint seeks unspecified monetary damages, including losses the participants and beneficiaries of the Plan allegedly experienced due to their investment through the Plan in MEMC's stock, equitable relief and an award of attorneys' fees. No class has been certified and discovery has not begun. The company and the named directors and employees filed a motion to dismiss the complaint, which was fully briefed by the parties as of October 9, 2009. The parties each subsequently filed notices of supplemental authority and corresponding responses. On March 17, 2010, the court denied the motion to dismiss. The MEMC defendants filed a motion for reconsideration or, in the alternative, certification for interlocutory appeal, which was fully briefed by the parties as of June 16, 2010. The parties each subsequently filed notices of supplemental authority and corresponding responses. On October 18, 2010, the court granted the MEMC defendants' motion for reconsideration, vacated its order denying the MEMC defendants' motion to dismiss, and stated that it will revisit the issues raised in the motion to dismiss after the parties supplement their arguments relating thereto. Both parties filed briefs supplementing their arguments on November 1, 2010. On June 28, 2011, plaintiff Jerry Jones filed a notice of voluntary withdrawal from the action. On June 29, 2011, the Court entered an order withdrawing Jones as one of the plaintiffs in this action. The parties each have continued to file additional notices of supplemental authority and responses thereto. On September 27, 2012, the MEMC defendants moved for oral argument on their pending motion to dismiss. Plaintiff Manuel Acosta joined in the MEMC defendants' motion for oral argument on October 9, 2012.  The Court has not ruled on this motion for oral argument. 

MEMC believes the above class action is without merit, and we will assert a vigorous defense. Due to the inherent uncertainties of litigation, we cannot predict the ultimate outcome or resolution of the foregoing class action proceedings or estimate the amounts of, or potential range of, loss with respect to these proceedings. An unfavorable outcome could have a material adverse impact on our business, results of operations and financial condition. We have indemnification agreements with each of our present and former directors and officers, under which we are generally required to indemnify each such director or officer against expenses, including attorneys' fees, judgments, fines and settlements, arising from actions such as the lawsuits described above (subject to certain exceptions, as described in the indemnification agreements).

From time to time we may conclude it is in the best interests of our stockholders, employees, vendors and customers to settle one or more litigation matters, and any such settlement could include substantial payments; however, other than as may be noted above, we have not reached this conclusion with respect to any particular matter at this time. There are a variety of factors that influence our decision to settle any particular individual matter, and the amount we may choose to pay or accept as payment to settle such matters, including the strength of our case, developments in the litigation (both expected and unexpected), the behavior of other interested parties, including non-parties to the matter, the demand on management time and the possible distraction of our employees associated with the case and/or the possibility that we may be subject to an injunction or other equitable remedy. It is difficult to predict whether a settlement is possible, the amount of an appropriate settlement or when is the opportune time to settle a matter in light of the numerous factors that go into the settlement decision.

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Fair Value Measurements (Changes in Level 3 Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012		Dec. 31, 2011
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Beginning Balance	$ (15.2)		$ (19.4)
Total unrealized gains (losses) included in earnings			16.8	[1]
Total unrealized gains included in other comprehensive income, net			(87.8)
Acquisitions, purchases, sales, redemptions, maturities and payments			(90.4)
Acquisitions, purchases, sales, redemptions, maturities and payments	80.9
Ending Balance	(24.7)		(15.2)
Amount of total losses included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held	(15.2)		16.8
Contingent Consideration Related to Acquisitions [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Beginning Balance	(90.8)		(26.2)
Total unrealized gains (losses) included in earnings	(15.0)	[1]	23.2	[1]
Acquisitions, purchases, sales, redemptions, maturities and payments	80.9		(87.8)
Ending Balance	(24.9)		(90.8)
Amount of total losses included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held	(15.0)		23.2
Other Derivatives [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Beginning Balance	0
Beginning Balance			1.6
Total unrealized gains (losses) included in earnings			(1.6)	[1]
Acquisitions, purchases, sales, redemptions, maturities and payments	0		0
Ending Balance			0
Ending Balance	0
Amount of total losses included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held	0		(1.6)
Suntech Warrant [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Beginning Balance	0.4		5.2
Total unrealized gains (losses) included in earnings	(0.2)	[1]	(4.8)	[1]
Acquisitions, purchases, sales, redemptions, maturities and payments	0		0
Ending Balance	0.2		0.4
Amount of total losses included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held	$ (0.2)		$ (4.8)

[1] Amounts included in earnings are recorded to non-operating expense (income) in the consolidated statement of operations, except for the amounts for contingent consideration related to acquisitions, for which changes to the fair value were recorded to marketing and administration in the consolidated statement of operations for fair market value adjustments and to interest expense for accretion.

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Restructuring and Impairment Charges (Narrative) (Details) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended			0 Months Ended		3 Months Ended		12 Months Ended														0 Months Ended	12 Months Ended		3 Months Ended		12 Months Ended
	Dec. 31, 2011 USD ($)	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Sep. 04, 2012 Purchase Obligation Termination [Member] USD ($) claim quarter	Sep. 04, 2012 Purchase Obligation Termination [Member] EUR (€)	Dec. 31, 2012 Purchase Obligation Termination [Member] EUR (€)	Sep. 30, 2012 Purchase Obligation Termination [Member] EUR (€)	Dec. 31, 2012 2009 U.S. Plan [Member] USD ($)	Dec. 31, 2011 2009 U.S. Plan [Member] USD ($)	Dec. 31, 2010 2009 U.S. Plan [Member] USD ($)	Dec. 31, 2012 2009 U.S. Plan [Member] Severance and Other Employee Benefits [Member] USD ($)	Dec. 31, 2011 2009 U.S. Plan [Member] Severance and Other Employee Benefits [Member] USD ($)	Dec. 31, 2010 2009 U.S. Plan [Member] Severance and Other Employee Benefits [Member] USD ($)	Dec. 31, 2012 2009 U.S. Plan [Member] Contract Termination [Member] USD ($)	Dec. 31, 2011 2009 U.S. Plan [Member] Contract Termination [Member] USD ($)	Dec. 31, 2010 2009 U.S. Plan [Member] Contract Termination [Member] USD ($)	Dec. 31, 2012 2011 Global Plan [Member] employee	Dec. 31, 2011 2011 Global Plan [Member] USD ($)	Dec. 31, 2012 2011 Global Plan [Member] Severance and Other Employee Benefits [Member] USD ($)	Dec. 31, 2012 2011 Global Plan [Member] Contract Termination [Member] USD ($)	Dec. 31, 2012 2011 Global Plan [Member] Other Restructuring [Member] USD ($)	Sep. 04, 2012 2011 Global Plan [Member] Purchase Obligation Termination [Member] USD ($)	Dec. 31, 2012 Global Plan June 2011 [Member] USD ($)	Dec. 31, 2012 Global Plan June 2011 [Member] Severance and Other Employee Benefits [Member] USD ($)	Dec. 31, 2011 Semiconductor Materials [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] USD ($)	Dec. 31, 2012 Solar Energy [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] USD ($)	Dec. 31, 2010 Solar Energy [Member] USD ($)
Restructuring Cost and Reserve [Line Items]
Payments for Legal Settlements							€ 15.0	€ 10.0
Litigation Settlement, Payment Installment Period, Number of Quarters					3	3
Increase (Decrease) in Other Noncurrent Assets					(10.2)
Restructuring and Related Cost, Expected Number of Positions Eliminated																		1,400
Restructuring and Related Cost, Expected Number of Positions Eliminated, Percent																		20.00%
Restructuring (Reversals) Charges	339.5	(83.5)	350.7	5.3																62.1	226.4	51.0			6.8	35.6	303.0
Restructuring and Related Cost, Expected Cost									27.9	46.0	48.3	15.5	18.8	21.0	2.9	2.9	3.0
Cash Payments									14.6	5.1	4.3	7.4	3.4	1.1	(2.9)	0	0		1.8					9.9
Assets impairment charges	365.4	20.0	381.7	0																						7.4	358.0
Goodwill, Impairment Loss	384.1	0	440.5	0																						0	384.1	440.5	440.5	0
Other than Temporary Impairment Losses, Investments	78.9	3.6	78.9	0																						0	78.9
Inventory Write-down	96.7	3.4	107.0																							14.2	82.5
Valuation Allowance, Deferred Tax Asset, Change in Amount		94.8
Loss Contingency, Claims Settled, Number					2	2
Litigation Settlement, Gross						70.0
Restructuring Reserve, Accrual Adjustment																							(69.2)
Gain on Receipt of Property Plant and Equipment		$ 31.7	$ 0	$ 0

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Income Tax Disclosure [Abstract]

Schedule of Income before Income Tax, Domestic and Foreign

before income tax expense (benefit) and equity in (loss) earnings of joint ventures consists of the following:

	For the year ended December 31,
	2012			2011			2010
In millions
U.S.	$	(261.1	)	$	(780.6	)	$	(157.8	)
Foreign	179.6			(603.5		)	145.3
Total	$	(81.5	)	$	(1,384.1	)	$	(12.5	)

Schedule of Components of Income Tax Expense (Benefit)

Income tax expense (benefit) consists of the following:

	Current			Deferred			Total
In millions
Year ended December 31, 2012:
U.S. Federal	$	38.9		$	(0.2	)	$	38.7
State and local	(14.0		)	0.7			(13.3		)
Foreign	47.5			(8.0		)	39.5
Total	$	72.4		$	(7.5	)	$	64.9
Year ended December 31, 2011:
U.S. Federal	$	6.7		$	37.2		$	43.9
State and local	4.6			4.7			9.3
Foreign	15.9			4.0			19.9
Total	$	27.2		$	45.9		$	73.1
Year ended December 31, 2010:
U.S. Federal	$	(46.6	)	$	(29.6	)	$	(76.2	)
State and local	(3.8		)	(2.3		)	(6.1		)
Foreign	44.2			(15.2		)	29.0
Total	$	(6.2	)	$	(47.1	)	$	(53.3	)

Schedule of Effective Income Tax Rate Reconciliation

Income tax expense (benefit) differed from the amounts computed by applying the statutory U.S. federal income tax rate of 35% to loss before income taxes and equity in (loss) earnings of joint ventures. The “Effect of foreign operations” includes the net reduced taxation of foreign profits from combining jurisdictions with rates above and below the U.S. federal statutory rate and the impact of U.S. foreign tax credits.

	For the year ended December 31,
	2012		2011		2010
Income tax at federal statutory rate	(35.0	)%	(35.0	)%	(35.0	)%
Increase (reduction) in income taxes:
Effect of foreign operations	(71.6	)	19.3		(47.4	)
Foreign incentives	(5.7	)	(1.1	)	(121.6	)
Foreign repatriation	(2.1	)	0.4		(91.7	)
State income taxes, net of U.S. Federal benefit	(16.6	)	0.7		(26.8	)
Tax authority positions, net	3.8		1.2		(97.0	)
Valuation allowance	183.2		15.1		—
Other, net	23.6		4.7		(6.9	)
Effective tax expense (benefit) rate	79.6	%	5.3	%	(426.4	)%

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

	For the year ended December 31,
	2012			2011
In millions
Beginning of year	$	46.2		$	30.4
Additions based on tax positions related to the current year	7.8			15.9
Reductions for tax positions of prior years	(3.1		)	(0.1		)
End of year	$	50.9		$	46.2

Schedule of Deferred Tax Assets and Liabilities

Our deferred tax assets and liabilities, netted by taxing location, are in the following captions in the consolidated balance sheet:

	As of December 31,
	2012			2011
In millions
Current deferred tax assets, net (recorded in prepaids and other current assets)	$	90.8		$	63.1
Non-current deferred tax (liabilities) assets, net	(5.9		)	44.8
Total	$	84.9		$	107.9

The tax effects of the major items recorded as deferred tax assets and liabilities are:

	As of December 31,
	2012			2011
In millions
Deferred tax assets:
Inventories	$	14.9		$	17.1
Restructuring liabilities	31.2			42.5
Expense accruals	52.0			53.1
Solar energy systems	461.9			366.7
Deferred revenue	66.3			4.4
Property, plant and equipment	35.7			54.1
Pension, medical and other employee benefits	12.2			27.2
Foreign repatriation	3.4			3.4
Net operating loss carryforwards	132.3			91.5
Foreign tax credits	70.8			28.8
Other	75.6			38.4
Total deferred tax assets	956.3			727.2
Valuation allowance	(510.5		)	(415.7		)
Net deferred tax assets	445.8			311.5
Deferred tax liabilities:
Solar energy systems	(286.7		)	(191.2		)
Other	(74.2		)	(12.4		)
Total deferred tax liabilities	(360.9		)	(203.6		)
Net deferred tax assets	$	84.9		$	107.9

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Condensed Consolidating Financial Information

12 Months Ended

Dec. 31, 2012

Condensed Consolidating Financial Information [Abstract]

CONDENSED CONSOLIDATING FINANCIAL INFORMATION

On March 10, 2011, we issued $550.0 million of 7.75% Senior Notes due April 1, 2019 (the “Original 2019 Notes”). The Original 2019 Notes were sold to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). In connection with the sale of the Original 2019 Notes, MEMC entered into a Registration Rights Agreement with the initial purchasers of the Original 2019 Notes, pursuant to which MEMC and the Subsidiary Guarantors (as defined below) agreed to file a registration statement with respect to an offer to exchange the Original 2019 Notes for a new issue of substantially identical notes registered under the Securities Act (the “Exchange 2019 Notes” and together with the Original 2019 Notes, the “2019 Notes”). The 2019 Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain wholly owned domestic subsidiaries of MEMC (the “Subsidiary Guarantors”).

The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule 3-10(d) of Regulation S-X promulgated under the Securities Act, presents the condensed consolidating financial information separately for:

i. MEMC, as the issuer of the 2019 Notes;

ii. The Subsidiary Guarantors, on a combined basis;

iii. MEMC's other subsidiaries, on a combined basis, which are not guarantors of the 2019 Notes (the “Subsidiary Non-Guarantors”);

iv. Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between or among MEMC, the Subsidiary Guarantors and the Subsidiary Non-Guarantors, (b) eliminate the investments in the MEMC's subsidiaries and (c) record consolidating entries; and

v. MEMC and its subsidiaries on a consolidated basis.

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	720.9		$	1,037.5		$	3,035.8		$	(2,264.3	)	$	2,529.9
Cost of goods sold	807.7			987.9			2,606.1			(2,207.4		)	2,194.3
Gross margin	(86.8		)	49.6			429.7			(56.9		)	335.6
Operating expenses:
Marketing and administration	112.4			81.1			112.7			—			306.2
Research and development	49.5			13.8			8.5			—			71.8
Gain on receipt of property, plant and equipment	—			—			(31.7		)	—			(31.7		)
Restructuring (reversals) charges	(2.9		)	2.5			(83.1		)	—			(83.5		)
Long-lived asset impairment charges	18.9			0.7			—			—			19.6
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating (loss) income	(264.7		)	(48.5		)	427.3			(56.9		)	57.2
Non-operating (income) expense:
Interest expense	54.6			6.8			73.9			—			135.3
Interest income	(0.1		)	(0.5		)	(3.0		)	—			(3.6		)
Decline in fair value of warrant	—			—			0.2			—			0.2
Other, net	(58.4		)	(5.9		)	62.7			8.4			6.8
Total non-operating (income) expense	(3.9		)	0.4			133.8			8.4			138.7
(Loss) income before income taxes, investment in subsidiary income (loss) and equity in loss of joint ventures	(260.8		)	(48.9		)	293.5			(65.3		)	(81.5		)
Income tax (benefit) expense	(59.6		)	91.9			57.6			(25.0		)	64.9
(Loss) income before investment in subsidiary income (loss) and equity in loss of joint ventures	(201.2		)	(140.8		)	235.9			(40.3		)	(146.4		)
Investment in subsidiary income (loss)	50.6			(1.5		)	—			(49.1		)	—
Equity in loss of joint ventures, net of tax	—			—			(2.3		)	—			(2.3		)
Net (loss) income	(150.6		)	(142.3		)	233.6			(89.4		)	(148.7		)
Net income attributable to noncontrolling interests	—			(0.7		)	(1.2		)	—			(1.9		)
Net (loss) income attributable to MEMC stockholders	$	(150.6	)	$	(143.0	)	$	232.4		$	(89.4	)	$	(150.6	)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	872.7		$	971.9		$	3,692.8		$	(2,821.9	)	$	2,715.5
Cost of goods sold	914.2			884.5			3,312.0			(2,690.1		)	2,420.6
Gross profit	(41.5		)	87.4			380.8			(131.8		)	294.9
Operating expenses:
Marketing and administration	138.3			78.8			135.7			—			352.8
Research and development	60.9			10.7			15.9			—			87.5
Goodwill impairment charges	—			430.8			9.7			—			440.5
Restructuring charges	8.2			6.7			335.8			—			350.7
Long-lived asset impairment	19.4			42.8			305.7			—			367.9
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating loss	(268.3		)	(482.4		)	(418.0		)	(131.8		)	(1,300.5		)
Non-operating (income) expense:
Interest expense	35.4			7.7			34.1			—			77.2
Interest income	(0.3		)	(0.4		)	(3.8		)	—			(4.5		)
Decline in fair value of warrant	—			—			4.8			—			4.8
Other, net	(142.3		)	(2.4		)	124.2			26.6			6.1
Total non-operating (income) expense	(107.2		)	4.9			159.3			26.6			83.6
Loss before income taxes, investment in subsidiary loss and equity in earnings (loss) of joint ventures	(161.1		)	(487.3		)	(577.3		)	(158.4		)	(1,384.1		)
Income tax expense	16.3			31.0			29.5			(3.7		)	73.1
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(177.4		)	(518.3		)	(606.8		)	(154.7		)	(1,457.2		)
Investment in subsidiary loss	(1,358.6		)	(1,046.2		)	—			2,404.8			—
Equity in earnings (loss) of joint ventures, net of tax	—			0.2			(63.0		)	—			(62.8		)
Net loss	(1,536.0		)	(1,564.3		)	(669.8		)	2,250.1			(1,520.0		)
Net income attributable to noncontrolling interests	—			(0.5		)	(15.5		)	—			(16.0		)
Net loss attributable to MEMC stockholders	$	(1,536.0	)	$	(1,564.8	)	$	(685.3	)	$	2,250.1		$	(1,536.0	)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	829.1		$	468.3		$	2,478.5		$	(1,536.7	)	$	2,239.2
Cost of goods sold	823.3			457.3			2,158.7			(1,537.2		)	1,902.1
Gross profit	5.8			11.0			319.8			0.5			337.1
Operating expenses:
Marketing and administration	122.0			61.2			83.8			—			267.0
Research and development	38.5			6.6			10.5			—			55.6
Restructuring charges	5.3			—			—			—			5.3
Insurance Recovery	—			(11.9		)	—			—			(11.9		)
Operating (loss) income	(160.0		)	(44.9		)	225.5			0.5			21.1
Non-operating (income) expense:
Interest expense	(1.7		)	3.2			30.9			(3.4		)	29.0
Interest income	(0.2		)	(2.7		)	(6.0		)	3.4			(5.5		)
Increase in fair value of warrant	—			—			14.0			—			14.0
Other, net	(44.5		)	1.2			23.4			16.0			(3.9		)
Total non-operating (income) expense	(46.4		)	1.7			62.3			16.0			33.6
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(113.6		)	(46.6		)	163.2			(15.5		)	(12.5		)
Income tax (benefit) expense	(64.6		)	(17.9		)	30.8			(1.6		)	(53.3		)
(Loss) income before investment in subsidiary earnings and equity in loss of joint ventures	(49.0		)	(28.7		)	132.4			(13.9		)	40.8
Investment in subsidiary earnings (loss)	84.9			(14.2		)	—			(70.7		)	—
Equity in (loss) earnings of joint ventures, net of tax	(1.5		)	—			8.7			—			7.2
Net income (loss)	34.4			(42.9		)	141.1			(84.6		)	48.0
Net loss (income) attributable to noncontrolling interests	—			0.3			(13.9		)	—			(13.6		)
Net income (loss) attributable to MEMC stockholders	$	34.4		$	(42.6	)	$	127.2		$	(84.6	)	$	34.4

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net (loss) income	$	(150.6	)	$	(142.3	)	$	233.6		$	(89.4	)	$	(148.7	)
Other comprehensive loss, net of tax:
Net translation adjustment	—			—			(18.5		)	—			(18.5		)
Net unrealized loss on available-for-sale securities	—			—			(2.8		)	—			(2.8		)
Loss on hedging instruments	—			—			(0.4		)	—			(0.4		)
Net actuarial loss and prior service credit, net of tax	(11.8		)	—			(0.1		)	—			(11.9		)
Other comprehensive loss, net of tax	(11.8		)	—			(21.8		)	—			(33.6		)
Total comprehensive (loss) income	(162.4		)	(142.3		)	211.8			(89.4		)	(182.3		)
Net income attributable to noncontrolling interests	—			(0.7		)	(1.2		)	—			(1.9		)
Net translation adjustment attributable to noncontrolling interests	—			—			(2.3		)	—			(2.3		)
Comprehensive (loss) income attributable to MEMC stockholders	$	(162.4	)	$	(143.0	)	$	208.3		$	(89.4	)	$	(186.5	)

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments		Total
Net loss	$	(1,536.0	)	$	(1,564.3	)	$	(669.8	)	$	2,250.1	$	(1,520.0	)
Other comprehensive loss, net of tax
Net translation adjustment	—			—			(2.5		)	—		(2.5		)
Net unrealized loss on available-for-sale securities	—			—			(24.9		)	—		(24.9		)
Gain on hedging instruments	—			—			7.1			—		7.1
Net actuarial loss and prior service credit, net of tax	(14.0		)	—			(2.0		)	—		(16.0		)
Other comprehensive loss, net of tax	(14.0		)	—			(22.3		)	—		(36.3		)
Total comprehensive loss	(1,550.0		)	(1,564.3		)	(692.1		)	2,250.1		(1,556.3		)
Net income attributable to noncontrolling interests	—			(0.5		)	(15.5		)	—		(16.0		)
Net translation adjustment attributable to noncontrolling interests	—			—			(1.7		)	—		(1.7		)
Comprehensive loss attributable to MEMC stockholders	$	(1,550.0	)	$	(1,564.8	)	$	(709.3	)	$	2,250.1	$	(1,574.0	)

Condensed Consolidating Statement of Comprehensive (Loss) Income

December 31, 2010

(In millions)

	MEMC, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net income (loss)	$	34.4	$	(42.9	)	$	141.1		$	(84.6	)	$	48.0
Other comprehensive income (loss), net of tax:
Net translation adjustment	—		—			16.2			—			16.2
Net unrealized loss on available-for-sale securities	—		—			(2.9		)	—			(2.9		)
Loss on hedging instruments	—		—			(11.0		)	—			(11.0		)
Net actuarial loss and prior service credit, net of tax	3.9		—			(4.5		)	—			(0.6		)
Other comprehensive income (loss), net of tax	3.9		—			(2.2		)	—			1.7
Total comprehensive income (loss)	38.3		(42.9		)	138.9			(84.6		)	49.7
Net loss (income) attributable to noncontrolling interests	—		0.3			(13.9		)	—			(13.6		)
Net translation adjustment attributable to noncontrolling interests	—		—			(0.6		)	—			(0.6		)
Comprehensive income (loss) attributable to MEMC stockholders	$	38.3	$	(42.6	)	$	124.4		$	(84.6	)	$	35.5

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
ASSETS
Current assets:
Cash and cash equivalents	$	65.1	$	60.0	$	447.5	$	—		$	572.6
Restricted cash	—		—		72.4		—			72.4
Accounts receivable, net	62.0		23.7		134.7		—			220.4
Inventories	18.4		70.6		200.0		(41.2		)	247.8
Solar energy systems held for development and sale	—		0.3		213.7		(80.2		)	133.8
Prepaid and other current assets	24.9		40.1		147.2		—			212.2
Total current assets	170.4		194.7		1,215.5		(121.4		)	1,459.2
Investments	7.3		20.4		21.9		—			49.6
Investments in subsidiaries	498.2		564.2		—		(1,062.4		)	—
Property, plant and equipment, net:
Non solar energy systems	57.2		294.4		913.8		(52.3		)	1,213.1
Solar energy systems	—		3.0		1,361.3		95.6			1,459.9
Deferred tax assets, net	—		—		—		—			—
Restricted cash	—		1.7		48.5		—			50.2
Other assets	29.4		44.0		282.0		—			355.4
Intangible assets, net	—		110.9		3.3		—			114.2
Total assets	$	762.5	$	1,233.3	$	3,846.3	$	(1,140.5	)	$	4,701.6

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.4		$	—		$	3.4
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	—			0.2			97.6			—			97.8
Accounts payable	11.9			67.0			398.1			—			477.0
Accrued liabilities	32.8			42.5			268.9			—			344.2
Deferred revenue for solar energy systems	—			40.7			72.4			—			113.1
Contingent consideration related to acquisitions	—			23.1			—			—			23.1
Customer and other deposits	10.9			0.4			65.9			—			77.2
Intercompany (receivable) payable and short term notes	(651.0		)	764.3			(113.3		)	—			—
Total current liabilities	(595.4		)	938.2			793.0			—			1,135.8
Long-term debt and capital lease obligations, less current portion	746.1			—			12.6			—			758.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	—			9.8			1,498.6			—			1,508.4
Pension and post-employment liabilities	23.9			—			28.8			—			52.7
Customer and other deposits	87.8			—			96.7			—			184.5
Deferred revenue for solar energy systems	—			45.8			100.2			—			146.0
Deferred revenue for non solar energy systems	—			—			29.2			—			29.2
Long-term intercompany note (receivable) payable	(45.4		)	(96.2		)	141.6			—			—
Other liabilities	(29.8		)	112.0			126.7			—			208.9
Total liabilities	187.2			1,009.6			2,827.4			—			4,024.2
Redeemable noncontrolling interest	—			—			11.3			—			11.3
Total MEMC stockholders’ equity	575.3			223.7			916.8			(1,140.5		)	575.3
Noncontrolling interests	—			—			90.8			—			90.8
Total stockholders’ equity	575.3			223.7			1,007.6			(1,140.5		)	666.1
Total liabilities and stockholders’ equity	$	762.5		$	1,233.3		$	3,846.3		$	(1,140.5	)	$	4,701.6

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	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	72.3		315.5			916.4		(50.5		)	1,253.7
Solar energy systems	—		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
Goodwill	—		—			—		—			—
Intangible assets, net	—		145.2			4.0		—			149.2
Total assets	$	769.0	$	671.1		$	3,726.9	$	(285.4	)	$	4,881.6

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.7		$	—		$	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback 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 and capital lease obligations, less current portion	550.0			—			17.7			—			567.7
Long-term solar energy system debt, financings and capital leaseback 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
Deferred revenue for non solar energy systems	—			—			51.2			—			51.2
Long-term intercompany note (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

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(213.7	)	$	9.4		$	(7.3	)	$	(51.9	)	$	(263.5	)
Cash flows from investing activities:
Capital expenditures	(18.0		)	(19.5		)	(101.5		)	—			(139.0		)
Construction of solar energy systems	—			—			(387.8		)	40.9			(346.9		)
Purchases of cost and equity method investments	(8.2		)	—			(39.6		)	—			(47.8		)
Proceeds from return of (payments to) equity method investments	10.0			—			(4.2		)	—			5.8
Change in restricted cash	—			(1.5		)	8.2			—			6.7
Equity infusions or investments in subsidiaries	(44.0		)	(6.7		)	50.7			—			—
Other	2.0			0.1			(4.4		)	11.0			8.7
Net cash used in investing activities	(58.2		)	(27.6		)	(478.6		)	51.9			(512.5		)
Cash flows from financing activities:
Proceeds from long-term debt	196.0			—			—			—			196.0
Cash paid for contingent consideration	—			(15.1		)	(54.1		)	—			(69.2		)
Proceeds from solar energy system financing and capital lease obligations	—			8.4			895.8			—			904.2
Repayments of solar energy system financing and capital lease obligations	—			(0.5		)	(245.7		)	—			(246.2		)
Net repayments of customer deposits related to long-term supply agreements	—			—			(24.4		)	—			(24.4		)
Principal payments on long-term debt	—			—			(3.6		)	—			(3.6		)
Common stock repurchases	(0.5		)	—			—			—			(0.5		)
Receipts from noncontrolling interest	—			—			50.8			—			50.8
(Repayment of) collection of intercompany debt	(74.4		)	27.1			47.3			—			—
Debt financing fees	(12.7		)	—			(29.6		)	—			(42.3		)
Net cash provided by financing activities	108.4			19.9			636.5			—			764.8
Effect of exchange rate changes on cash and cash equivalents	(0.3		)	—			(1.7		)	—			(2.0		)
Net (decrease) increase in cash and cash equivalents	(163.8		)	1.7			148.9			—			(13.2		)
Cash and cash equivalents at beginning of period	228.9			58.3			298.6			—			585.8
Cash and cash equivalents at end of period	$	65.1		$	60.0		$	447.5		$	—		$	572.6

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(216.5	)	$	66.3		$	193.0		$	(58.1	)	$	(15.3	)
Cash flows from investing activities:
Capital expenditures	(24.1		)	(56.4		)	(372.0		)	—			(452.5		)
Construction of solar energy systems	—			—			(627.5		)	29.4			(598.1		)
Purchases of cost and equity method investments	(1.1		)	(5.0		)	(44.3		)	—			(50.4		)
Proceeds from return of equity method investments	82.0			13.7			—			—			95.7
Change in restricted cash	—			0.5			(124.3		)	—			(123.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			(14.4		)	(0.1		)	—			(14.5		)
Proceeds from Property, Plant and Equipment	—			—			43.9			—			43.9
Cash payments for acquisition, net of cash acquired	—			(160.1		)	(3.9		)	—			(164.0		)
Equity infusions or investments in subsidiaries	82.9			2.8			(85.7		)	—			—
Other	5.7			(0.1		)	(33.5		)	28.7			0.8
Net cash provided by (used in) investing activities	145.4			(219.0		)	(1,247.4		)	58.1			(1,262.9		)
Cash flows from financing activities:
Proceeds from long-term debt	550.0			—			—			—			550.0
Proceeds from solar energy system financing and capital lease obligations	—			0.5			1,070.7			—			1,071.2
Cash paid for contingent consideration	—			(50.2		)	—			—			(50.2		)
Repayments of solar energy system financing and capital lease obligations	—			(1.8		)	(264.7		)	—			(266.5		)
Net repayments of customer deposits related to long-term supply agreements	—			(1.8		)	(55.9		)	—			(57.7		)
(Repayment of) collections on intercompany debt	(243.7		)	257.2			(13.5		)	—			—
Principal payments on long-term debt	—			—			(3.7		)	—			(3.7		)
Purchases of and dividends to noncontrolling interest	—			—			(49.0		)	—			(49.0		)
Common stock repurchases	(3.6		)	—			—			—			(3.6		)
Debt financing fees	(18.0		)	—			(21.8		)	—			(39.8		)
Net cash provided by financing activities	284.7			203.9			662.1			—			1,150.7
Effect of exchange rate changes on cash and cash equivalents	(0.2		)	(0.1		)	6.3			—			6.0
Net increase (decrease) in cash and cash equivalents	213.4			51.1			(386.0		)	—			(121.5		)
Cash and cash equivalents at beginning of period	15.5			7.2			684.6			—			707.3
Cash and cash equivalents at end of period	$	228.9		$	58.3		$	298.6		$	—		$	585.8

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(128.4	)	$	65.0		$	318.5		$	92.5		$	347.6
Cash flows from investing activities:
Capital expenditures	(25.1		)	(45.7		)	(281.2		)	—			(352.0		)
Construction of solar energy systems	—			(1.4		)	(171.9		)	(106.8		)	(280.1		)
Proceeds from sale and maturities of investments	—			—			185.0			—			185.0
Purchases of cost and equity method investments	—			(10.4		)	(8.4		)	—			(18.8		)
Proceeds from return of equity method investments	85.3			—			—			—			85.3
Change in restricted cash	—			0.3			(2.1		)	—			(1.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			—			(85.0		)	—			(85.0		)
Cash payments for acquisition, net of cash acquired	(75.7		)	2.2			—			—			(73.5		)
Equity infusions or investments in subsidiaries	(30.2		)	1.8			28.4			—			—
Other	30.7			2.9			(28.8		)	14.3			19.1
Net cash used in investing activities	(15.0		)	(50.3		)	(364.0		)	(92.5		)	(521.8		)
Cash flows from financing activities:
Proceeds from solar energy system financing and capital lease obligations	—			1.8			362.6			—			364.4
Repayments of solar energy system financing and capital lease obligations	—			(1.9		)	(59.2		)	—			(61.1		)
Net repayments of customer deposits related to long-term supply agreements	—			(0.4		)	(30.9		)	—			(31.3		)
Collections on (repayment of) intercompany debt	55.9			(55.9		)	—			—			—
Principal payments on long-term debt	—			—			(4.8		)	—			(4.8		)
Purchases of and dividends to noncontrolling interest	—			(0.8		)	(7.5		)	—			(8.3		)
Common stock repurchases	(2.9		)	—			—			—			(2.9		)
Debt financing fees	—			—			(12.8		)	—			(12.8		)
Net cash provided by (used in) financing activities	53.0			(57.2		)	247.4			—			243.2
Effect of exchange rate changes on cash and cash equivalents	—			—			5.6			—			5.6
Net (decrease) increase in cash and cash equivalents	(90.4		)	(42.5		)	207.5			—			74.6
Cash and cash equivalents at beginning of period	105.9			49.7			477.1			—			632.7
Cash and cash equivalents at end of period	$	15.5		$	7.2		$	684.6		$	—		$	707.3

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2012

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates

In preparing our financial statements, we use estimates and assumptions that may affect reported amounts and disclosures. Estimates are used when accounting for investments, depreciation, amortization, leases, accrued liabilities including restructuring, warranties, employee benefits, derivatives, stock-based compensation, income taxes, solar energy system installation and related costs, percentage-of-completion on long-term construction contracts, the fair value of assets and liabilities recorded in connection with business combinations, and goodwill and asset recoverability, including allowances, among others. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. To the extent there are material differences between the estimates and actual results, our future results of operations would be affected.

Variable Interest Entities

Variable Interest Entities

SunEdison’s business can involve the formation of special purpose vehicles (referred to as “project companies”) to own the project assets and execute agreements for the construction and maintenance of the assets, as well as power purchase agreements or feed in tariff agreements with a buyer who will purchase the electricity generated from the solar energy system once it is operating. SunEdison may establish joint ventures with non-related parties to share in the risks and rewards associated with solar energy system development, which are facilitated through equity ownership of a project company. The project companies engage SunEdison to engineer, procure and construct the solar energy system and may separately contract with SunEdison to perform predefined operational and maintenance services post construction. We evaluate the terms of those contracts as well as the joint venture agreements to determine if the entity is a VIE, as well as if SunEdison is the primary beneficiary.

VIEs are primarily entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions; (b) obligation to absorb expected losses; or (c) right to receive expected residual returns. VIEs must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. A VIE should have only one primary beneficiary, but may not have a primary beneficiary if no party meets the criteria described above.

To determine a VIE's primary beneficiary, an enterprise must perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. Therefore, an enterprise must identify the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, and must therefore consolidate the entity, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. If that evaluation is inconclusive as to which party absorbs a majority of the entity’s expected losses or residual returns, a quantitative analysis is performed to determine the primary beneficiary.

For our consolidated VIEs, we have presented on our consolidated balance sheets, to the extent material, the assets of our consolidated VIEs that can only be used to settle specific obligations of the consolidated VIE, and the liabilities of our consolidated VIEs for which creditors do not have recourse to our general assets outside of the VIE.

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the Company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash equivalents include highly liquid commercial paper, time deposits and money market funds with original maturity periods of three months or less when purchased. The majority of our cash and cash equivalents are held outside the U.S. Total cash and cash equivalents maintained by foreign subsidiaries whose functional currency is not the U.S. dollar were $171.5 million and $64.2 million as of December 31, 2012 and 2011, respectively. Cash and cash equivalents consist of the following:

	As of December 31,
	2012		2011
Dollars in millions
Cash	$	514.5	$	417.0
Cash Equivalents:
Commercial paper	10.0		10.0
Money market funds	48.1		158.8
	$	572.6	$	585.8

Restricted Cash

Restricted Cash

Restricted cash consists of cash on deposit in financial institutions that is restricted from use in operations. In certain transactions, we have agreed to issue a letter of credit or provide security deposits regarding the performance or removal of a solar energy system. Incentive application fees are deposited with local governmental jurisdictions which are held until the construction of the applicable solar energy system is completed. In addition, cash received during the lease term of a sale leaseback transaction may be subject to a security and disbursement agreement which generally establishes a reserve requirement for scheduled lease payments under our master lease agreements as discussed below under Revenue Recognition, Solar Energy System Sales, Sale with a leaseback, for each leaseback arrangement, as well as certain additional reserve requirements that may be temporarily required in an accrual account. All of the reserve requirements for scheduled lease payments for all projects under each master lease agreement must be satisfied before cash is disbursed under the master lease agreements.

Allowance for Doubtful Accounts

Allowance for Doubtful AccountsWe establish an allowance for doubtful accounts to adjust our receivables to amounts considered to be ultimately collectible. Our allowance is based on a variety of factors, including the length of time receivables are past due, significant one-time events, the financial health of our customers and historical experience. The balance of our allowance for doubtful accounts was $4.4 million and $4.9 million as of December 31, 2012 and 2011, respectively. Our provision for bad debts was a $0.3 million benefit, due to the recovery of previously written off accounts, $1.4 million expense and $1.4 million benefit for the years ended December 31, 2012, 2011 and 2010, respectively. There were $0.2 million, $4.3 million and $0.7 million of write-offs for bad debts for the years ended December 31, 2012, 2011, and 2010 respectively.

Inventories

Inventories

Inventories consists of raw materials, labor and manufacturing overhead and are valued at the lower of cost or market. Fixed overheads are allocated to the costs of conversion based on the normal capacity of our production facilities. Unallocated overheads during periods of abnormally low production levels are recognized as cost of goods sold in the period in which they are incurred. Raw materials and supplies are generally stated at weighted-average cost and goods and work-in-process and finished goods inventories are stated at standard cost as adjusted for variances, which approximates weighted-average actual cost. The valuation of inventory requires us to estimate excess and slow moving inventory. The determination of the value of excess and slow moving inventory is based upon assumptions of future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

Inventories also includes raw materials (such as solar panels) and supplies used to construct future solar energy systems developed for sale to third parties, which have not been designated to a specific project as of the balance sheet date. When the inventory is designated for use to build a specific project, the inventory will be reclassified to either solar energy systems held for development and sale or to property, plant and equipment - construction in progress, which is determined based on our intended use of the system. The cost of raw materials for solar energy systems is based on the first-in, first-out (FIFO) method.

Solar Energy Systems Held for Development and Sale

Solar Energy Systems Held for Development and Sale

Solar energy systems are classified as either held for development and sale or as property, plant and equipment based on our intended use of the system once constructed and provided that certain criteria to be classified as held for sale are met. The classification of the system affects the future accounting and presentation in the consolidated financial statements, including the consolidated statement of operations and statement of cash flows.  Transactions related to the construction and sale of solar energy systems classified as held for development and sale are classified as operating activities in the consolidated statement of cash flows and within gross profit in the statement of operations when sold.  Solar energy systems that are classified as property, plant and equipment generally relate to our sale leaseback transactions.  The costs to construct solar energy systems classified as property, plant and equipment are classified in the investing activities of the consolidated statement of cash flows. The proceeds received for the sale and subsequent leaseback are classified as cash flows from financing activities within the consolidated statement of cash flows.

Solar energy systems held for development include solar energy system project related assets for projects that have commenced and are actively marketed and intended to be sold. Development costs include capitalizable costs for items such as permits, acquired land, deposits and work-in-process, among others. Work-in-process includes materials, labor and other capitalizable costs incurred to construct solar energy systems. 

Solar energy systems held for sale are completed solar energy systems that have been interconnected. Solar energy systems held for sale are available for immediate sale in their present conditions subject only to terms that are usual and customary for sales of these types of assets. In addition, we are actively marketing the systems to potential third party buyers, and it is probable that the system will be sold within one year of its placed in service date. Solar energy systems held for sale also include systems under contract with a buyer that are accounted for using the deposit method, whereby cash proceeds received from the buyer are held as deposits until a sale can be recognized.

We do not depreciate our solar energy systems while classified as held for sale. Any energy or incentive revenues are recorded to other income, as such revenues are incidental to our intended use of the system (direct sale to a third party buyer). If facts and circumstances change such that it is no longer probable that the system will be sold within one year of the system's completion date, the system will be reclassified to property, plant and equipment, and we will record depreciation expense in the amount that would have otherwise been recorded during the period the system was classified as held for sale.

Property, Plant and Equipment

Property, Plant and Equipment

We record property, plant and equipment at cost and depreciate it evenly over the assets’ estimated useful lives as follows:

	Years
Software	3-6
Buildings and improvements	4-60
Machinery and equipment	1-25
Solar energy systems	23-30

Expenditures for repairs and maintenance are charged to expense as incurred. Additions and betterments are capitalized. The cost and related accumulated depreciation on property, plant and equipment sold or otherwise disposed of are removed from the capital accounts and any gain or loss is reported in current-year operations.

We often construct solar energy systems for which we do not have a fixed-price construction contract and, in certain instances, we may construct a system and retain ownership of the system or perform a sale-leaseback. For these projects, we earn revenues associated with the energy generated by the solar energy system, capitalize the cost of construction to solar energy system property, plant and equipment and depreciate the system over its estimated useful life. For solar energy systems under construction for which we intend to retain ownership and finance the system, we recognize all costs incurred as solar system construction in progress.

We may sell a solar energy system and simultaneously lease back the solar energy system. Property, plant and equipment accounted for as capital leases (primarily solar energy systems) are depreciated over the life of the lease. Solar energy systems that have not reached consummation of a sale under real estate accounting and have been leased back are recorded at the lower of the original cost to construct the system or its fair value and depreciated over the equipment's estimated useful life. For those sale leasebacks accounted for as capital leases, the gain, if any, on the sale leaseback transaction is deferred and recorded as a contra-asset that reduces the cost of the solar energy system, thereby reducing depreciation expense over the life of the asset. Generally, as a result of various tax attributes that accrue to the benefit of the lessor/tax owner, solar energy systems accounted for as capital leases are recorded at the net present value of the future minimum lease payments because this amount is lower than the cost and fair market value of the solar energy system at the lease inception date.

Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the remaining lease term, including renewal periods considered reasonably assured of execution.

When we are entitled to incentive tax credits for property, plant and equipment, we reduce the asset carrying value by the amount of the credit, which reduces future depreciation.

Consolidated depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $200.6 million, $217.7 million and $158.9 million, respectively, and includes depreciation expense for capital leases of $4.3 million, $9.7 million and $4.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The cost of constructing facilities, equipment and solar energy systems includes interest costs incurred during the asset's construction period. Capitalized interest totaled $19.9 million, $18.1 million and $5.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Asset retirement obligations are recognized at fair value in the period in which they are incurred and the carrying amount of the related long-lived asset is correspondingly increased. Over time, the liability is accreted to its expected future value. The corresponding asset capitalized at inception is depreciated over the useful life of the asset. We operate under solar power services agreements with some customers that include a requirement for the removal of the solar energy systems at the end of the term of the agreement. In addition, we could have certain legal obligations for asset retirements related to disposing of materials in the event of closure, abandonment or sale of certain of our manufacturing facilities. We recognize a liability in the period in which we have determined the time frame that the asset will no longer operate and information is available to reasonably estimate the liability’s fair value.

Impairment of Long-Lived Assets

Impairment of Property, Plant and Equipment

We periodically assess the impairment of long-lived assets/asset groups when conditions indicate a possible loss. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using: (i) quoted market prices or (ii) discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. We recorded asset impairment charges in 2012 and 2011; no similar charges were recorded in 2010. See Note 9 for additional discussion on the impairment charges on long-lived assets.

Goodwill and Intangible Assets

oodwill and Intangible Assets

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired and liabilities assumed. Goodwill and intangible assets determined to have indefinite lives are not amortized, but rather are subject to an impairment test annually, on December 1, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Our indefinite-lived intangible assets include power plant development arrangements acquired in a business combination which relate to anticipated future economic benefits associated with our customer backlog relationships. These intangible assets will be allocated to fixed assets as the construction of the related solar energy systems stemming from the existing backlog is completed.

The goodwill impairment test involves a two-step approach. Under the first step, we determine the fair value of each reporting unit to which goodwill has been assigned. We compare the fair value of the reporting unit to its carrying value, including goodwill. If the estimated fair value exceeds the carrying value, no impairment loss is recognized. If the carrying value exceeds the fair value, goodwill is considered potentially impaired and the second step is completed in order to measure the impairment loss. Under the second step, if applicable, we calculate the implied fair value of goodwill by deducting the fair value of all tangible and intangible net assets, including any unrecognized intangible assets, of the reporting unit from the fair value of the reporting unit as determined in the first step.

We then compare the implied fair value of goodwill to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, we recognize an impairment loss equal to the difference. See Note 10 for discussion on the goodwill impairment charges recorded during the year ended December 31, 2011. As of December 31, 2012, we had no remaining goodwill.

Intangible assets that have determinable estimated lives are amortized over those estimated lives. The straight-line method of amortization is used because it best reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up. The amounts and useful lives assigned to intangible assets acquired impact the amount and timing of future amortization. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. During 2012 and 2011 we recorded intangible asset impairments; see Note 10. No similar charges were recorded in 2010.

The estimated useful lives of our intangible assets subject to amortization are as follows:

	Years
Favorable energy credits	4-18
Customer sales backlog and relationships	1-6
Trade name	15
Developed technology	5

O

Operating and Capital Leases

perating Leases

We enter into lease agreements for a variety of business purposes, including office and manufacturing space, office and manufacturing equipment and computer equipment. A portion of these are noncancellable operating leases.

Capital Leases

We are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. For those transactions which do not fall under real estate accounting, we record a lease liability and the solar energy system is retained on our balance sheet. The excess of the cash proceeds of the sale leaseback over the costs to construct the solar energy system is retained by us and used to fund current operations and new solar energy projects. See further discussion in Revenue Recognition below.

Customer Deposits

ustomer and Other Deposits

We have executed long-term solar wafer supply agreements, including amendments, with multiple customers which required the customers to provide security deposits. The terms of these deposits vary, but are generally required to be applied against a portion of current sales on credit or refunded to customers over the term of the applicable agreement. We also receive short-term deposits from customers, deposits from suppliers and, in 2012 and 2011, received deposits in connection with a supply and license agreement with one of our joint ventures. See Note 6.

Revenue Recognition

evenue Recognition

Wafer and Other Product Sales

Revenue is recognized for wafer and other product sales when title transfers, the risks and rewards of ownership have been transferred to the customer, the fee is fixed or determinable and collection of the related receivable is reasonably assured, which is generally at the time of shipment for non-consignment orders. In the case of consignment orders, title passes when the customer pulls the product from the assigned storage facility or storage area or, if the customer does not pull the product within a contractually stated period of time (generally 60–90 days), at the end of that period, or when the customer otherwise agrees to take title to the product. Our wafers are generally made to customer specifications, and we conduct rigorous quality control and testing procedures to ensure that the finished wafers meet the customer’s specifications before the product is shipped. We consider international shipping term definitions in our determination of when title passes. We defer revenue for multiple element arrangements based on an average fair value per unit for the total arrangement when we receive cash in excess of fair value. We also defer revenue when pricing is not fixed or determinable or other revenue recognition criteria is not met.

In connection with certain of our long-term solar wafer supply agreements, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements.

Solar Energy System Sales

Solar energy system sales involving real estate

We recognize revenue for solar energy system sales with the concurrent sale or the concurrent lease of the underlying land, whether explicit or implicit in the transaction, in accordance with ASC 360-20, Real Estate Sales. For these transactions, we evaluate the solar energy system to determine whether the equipment is integral equipment to the real estate; therefore, the entire transaction is in substance the sale of real estate and subject to revenue recognition under ASC 360-20. A solar energy system is determined to be integral equipment when the cost to remove the equipment from its existing location, ship and reinstall at a new site, including any diminution in fair value, exceeds ten percent of the fair value of the equipment at the time of original installation. For those transactions subject to ASC 360-20, we recognize revenue and profit using the full accrual method once the sale is consummated, the buyer's initial and continuing investments are adequate to demonstrate its commitment to pay, our receivable is not subject to any future subordination, and we have transferred the usual risk and rewards of ownership to the buyer. If these criteria are met and we execute a sales agreement prior to the delivery of the solar energy system and have an original construction period of three months or longer, we recognize revenue and profit under the percentage of completion method of accounting applicable to real estate sales when we can reasonably estimate progress towards completion. During 2012 and 2011, we recognized $97.8 million and $54.3 million, respectively, of revenue using the percentage of completion method. Prior to 2011, we did not have sales that qualified for using the percentage of completion method.

If the criteria for recognition under the full accrual method are met except that the buyer's initial and continuing investment is less than the level determined to be adequate, then we will recognize revenue using the installment method. Under the installment method, we record revenue up to our costs incurred and apportion each cash receipt from the buyer between cost recovered and profit in the same ratio as total cost and total profit bear to the sales value. During 2012 and 2011, we recognized revenue of $22.7 million and $28.5 million, respectively, using the installment method. Prior to 2011, we did not have sales that qualified for using the installment method.

If we retain some continuing involvement with the solar energy system and do not transfer substantially all of the risks and rewards of ownership, profit shall be recognized by a method determined by the nature and extent of our continuing involvement, provided the other criteria for the full accrual method are met. In certain cases, we may provide our customers guarantees of system performance or uptime for a limited period of time and our exposure to loss is contractually limited based on the terms of the applicable agreement. In accordance with real estate sales accounting guidance, the profit recognized is reduced by our maximum exposure to loss (and not necessarily our most probable exposure), until such time that the exposure no longer exists.

Other forms of continuing involvement that do not transfer substantially all of the risks and rewards of ownership preclude revenue recognition under real estate accounting and require us to account for any cash payments using either the deposit or financing method. Such forms of continuing involvement may include contract default or breach remedies that provide SunEdison with the option or obligation to repurchase the solar energy system. Under the deposit method, cash payments received from customers are reported as deferred revenue for solar energy systems on the consolidated balance sheet, and under the financing method, cash payments received from customers are considered debt and reported as solar energy financing and capital lease obligations on the consolidated balance sheet.

Solar energy system sales not involving real estate

We recognize revenue for solar energy system sales without the concurrent sale or the concurrent lease of the underlying land at the time a sales arrangement with a third party is executed, delivery has occurred and we have determined that the sales price is fixed or determinable and collectible. For transactions that involve a construction period of three months or longer, we recognize the revenue in accordance with ASC 605-35, Construction-Type and Production-Type Contracts, using the percentage of completion method, measured by actual costs incurred for work completed to total estimated costs at completion for each transaction. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and travel costs. Marketing and administration costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are recognized in full during the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and revenue and are recognized in the period in which the revisions are determined. During the year ended December 31, 2012, we recorded $25.0 million of revenue under the percentage of completion method for solar energy sytems not involving real estate. There were no such amounts recognized in 2011 or 2010.

Solar energy system sales with service contracts

SunEdison frequently negotiates and executes solar energy system sales contracts and post-system-sale service contracts contemporaneously, which we combine and evaluate together as a single arrangement with multiple deliverables. The total arrangement consideration is first separated and allocated to post-system-sale separately priced extended warranty and maintenance service contracts, and the revenue associated with that deliverable is recognized on a straight-line basis over the contract term. The remaining consideration is allocated to each unit of accounting based on the respective relative selling prices, and revenue is recognized for each unit of accounting when the revenue recognition criteria have been met.

Sale with a leaseback

We are a party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. We must determine the appropriate classification of the sale leaseback on a project-by-project basis because the terms of the solar energy systems lease schedule may differ from the terms applicable to other solar energy systems. In addition, we must determine if the solar energy system is considered integral equipment to the real estate upon which it resides. We do not recognize revenue on the sales transactions for any sales with a leaseback. Instead, revenue is recognized through the sale of electricity and energy credits which are generated as energy is produced. The terms of the lease and whether the system is considered integral to the real estate upon which it resides may result in either one of the following sale leaseback classifications:

Capital lease arrangements

Sale/capital leaseback classification for non-real estate transactions occurs when the terms of the lease schedule for a solar energy system result in a capital lease classification. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system. Under a capital lease, a capitalized leased asset and obligation is recorded at the present value of the minimum lease payments. Any gain on the sale is recorded as a reduction of the capitalized leased asset which is then recognized to cost of goods sold through reduced depreciation expense over the term of the lease. As of the SunEdison acquisition date of November 20, 2009 through December 31, 2012, there were no arrangements which resulted in this accounting.

Financing arrangements

The financing method is applicable when we have determined that the assets under the lease are real estate. This occurs due to either a transfer of land or the transfer of a lease involving real estate and the leased equipment is integral equipment to the real estate. A sale leaseback is classified as a financing sale leaseback if we have concluded the leased assets are real estate and we have a prohibited form of continuing involvement, such as an option or obligation to repurchase the assets under our master lease agreements.

Under a financing sale leaseback, we do not recognize any upfront profit because a sale is not recognized. The full amount of the financing proceeds is recorded as solar energy financing debt, which is typically secured by the solar energy system asset and its future cash flows from energy sales, but generally has no recourse to MEMC or SunEdison under the terms of the arrangement.

We use our incremental borrowing rate to determine the principal and interest component of each lease payment. However, to the extent that our incremental borrowing rate will result in either negative amortization of the financing obligation or a built-in loss at the end of the lease (e.g. net book value of the system asset exceeds the financing obligation), the rate is adjusted to eliminate such results. The interest rate is adjusted accordingly for the majority of our financing leasebacks because our future minimum lease payments do not typically exceed the initial proceeds received from the buyer-lessor. As a result, most of our lease payments are reported as interest expense, the principal of the financing debt does not amortize, and we expect to recognize a gain upon the final lease payment at the end of the lease term equal to the unamortized balance of the financing debt less the write-off of the system assets net book value.

Operations and maintenance

Operations and maintenance revenue is billed and recognized as services are performed. Costs of these revenues are expensed in the period they are incurred.

Solar energy service revenues, energy credits and incentives

For SunEdison-owned or capitalized solar energy systems in the U.S., we may receive incentives or subsidies from various state governmental jurisdictions in the form of renewable energy credits (“RECs”), which we sell to third parties. In the State of California, we may also receive performance-based incentives (“PBIs”) from public utilities in connection with a program sponsored by the State of California. The Solar Energy segment recorded total PBI revenue of $31.4 million, $24.3 million and $18.6 million for the years ended December 31, 2012, 2011 and 2010, respectively, and total REC revenue of $17.3 million, $15.1 million and $7.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. Both the RECs and PBIs are based on the actual level of output generated from the system. RECs are generated as our solar energy systems generate electricity. Typically, SunEdison enters into five to ten year binding contractual arrangements with utility companies or other investors who purchase RECs at fixed rates. REC revenue is recognized at the time SunEdison has transferred a REC pursuant to an executed contract relating to the sale of the RECs to a third party. For PBIs, production from SunEdison-operated systems is verified by an independent third party and, once verified, revenue is recognized based on the terms of the contract and the fulfillment of all revenue recognition criteria. There are no penalties in the event electricity is not produced for PBIs. However, if production does not occur on the systems for which we have sale contracts for our RECs, we may have to purchase RECs on the spot market or pay specified contractual damages. Historically, we have not had to purchase material amounts of RECs to fulfill our REC sales contracts.

Recording of a sale of RECs and receipt of PBIs under U.S. GAAP are accounted for under ASC 605, Revenue Recognition. There are no differences in the process and related revenue recognition between REC sales to utilities and non-utility customers. Revenue is recorded when all revenue recognition criteria are met, including: there is persuasive evidence an arrangement exists (typically through a contract), services have been rendered through the production of electricity, pricing is fixed and determinable under the contract and collectability is reasonably assured. For RECs, the revenue recognition criteria are met when the energy is produced and a REC is generated and transferred to a third party pursuant to a contract with that party fixing the price for the REC. For PBIs, revenue is recognized upon validation of the kilowatt hours produced from a third party metering company because the quantities to be billed to the utility are determined and agreed to at that time.

Derivative Financial Instruments and Hedging Activities

Derivative Financial Instruments and Hedging Activities

All derivative instruments are recorded on the consolidated balance sheet at fair value. Derivatives not designated as hedge accounting and used to hedge foreign-currency-denominated balance sheet items are reported directly in earnings along with offsetting transaction gains and losses on the items being hedged. Derivatives used to hedge foreign-currency denominated cash flows and floating rate debt may be accounted for as cash flow hedges, as deemed appropriate. Gains and losses on derivatives designated as cash flow hedges are recorded in other comprehensive (loss) income and reclassified to earnings in a manner that matches the timing of the earnings impact of the hedged transactions. The ineffective portion of all hedges, if any, is recognized currently in earnings. Derivatives used to manage the foreign currency exchange risk associated with a net investment denominated in another currency are accounted for as a net investment hedge. The effective portion of the hedge will be recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. When the investment is dissolved and MEMC recognizes a gain or loss in other income (expense), the associated hedge gain or loss in other comprehensive (loss) income will be reclassified to other income (expense).

Derivatives not designated as hedging

During 2006, we executed a long-term supply agreement with a customer, Suntech Power Holdings (“Suntech”). At the same time, we received a fully vested, non-forfeitable warrant to purchase common shares of Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The warrant becomes exercisable over a five year period (20% annually) beginning January 1, 2008 and has a five year exercise period from the date each tranche becomes exercisable. The estimated grant date fair value of the warrant was $66.6 million and was recorded to other assets with the offset to non-solar energy system deferred revenue – long-term on the consolidated balance sheet. The non-cash transaction was excluded from the consolidated statement of cash flows. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. We used a lattice model to determine the warrant’s fair value. The assumptions used in calculating the fair value of the warrant represented our best estimates, but these estimates involved inherent uncertainties and the application of our judgment.

We generally use currency forward contracts to manage foreign currency exchange risk relating to current trade receivables and payables with our foreign subsidiaries and current trade receivables and payables with our customers and vendors denominated in foreign currencies (primarily Japanese Yen and Euro). The purpose of our foreign currency forward contract activities is to protect us from the risk that the dollar net cash flows resulting from foreign currency transactions will be negatively affected by changes in exchange rates. We do not hold or issue financial instruments for speculative or trading purposes. Gains or losses on our forward contracts, as well as the offsetting losses or gains on the related hedged receivables and payables, are included in non-operating expense (income) in the consolidated statement of operations. Net currency losses on unhedged foreign currency positions totaled $6.6 million, $4.7 million and $0.5 million in 2012, 2011 and 2010, respectively.

Derivatives designated as hedging

In addition to the currency forward contracts purchased to hedge transactional currency risks, we may enter into currency forward contracts to hedge cash flow risks associated with future purchases of raw materials. Our cash flow hedges are designed to protect against the variability in foreign currency rates between a foreign currency and the U.S. Dollar. As of December 31, 2012, there were no currency forward contracts outstanding being accounted for as cash flow hedges.

We are party to four interest rate swap instruments, three of which are accounted for using hedge accounting. The interest rate swaps are used to manage risks generally associated with interest rate fluctuations. For those financial instruments that qualify for cash flow hedging in accordance with derivative instrument and hedging activities guidance, we have elected to use hedge accounting, whereby changes in the fair market value of the derivative instruments are reflected in the accompanying consolidated financial statements in other comprehensive (loss) income . The counterparties to these agreements are financial institutions. The fair values of the contracts are estimated by obtaining quotations from the financial institutions. The fair value is an estimate of the net amount that we would pay on December 31, 2012, if the agreements were transferred to other parties or cancelled by us.

Our previous joint venture with Q-Cells SE, which was not consolidated, was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract for 70.0 million Euros. The forward contract met all the criteria for hedge accounting and the derivative instrument was effective as an economic hedge of foreign exchange risk associated with the hedged net investment. The effective portion of the hedge was recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our consolidated statement of operations, as the remaining investment in Q-Cells SE and related forward contracts were liquidated in the fourth quarter of 2010. See Note 5 for further discussion.

Translation of Foreign Currencies

Translation of Foreign Currencies

We determine the functional currency of each subsidiary based on a number of factors, including the predominant currency for the subsidiary’s sales and expenditures and the subsidiary’s borrowings. When a subsidiary’s local currency is considered its functional currency, we translate its financial statements to U.S. Dollars as follows:

• Assets and liabilities using exchange rates in effect at the balance sheet date; and

• Statement of operations accounts at average exchange rates for the period.

Adjustments from the translation process are presented in accumulated other comprehensive (loss) income in stockholders’ equity.

Income Taxes

Income Taxes

Deferred income taxes arise because of a different tax basis of assets or liabilities between financial statement accounting and tax accounting, which are known as temporary differences. We record the tax effect of these temporary differences as deferred tax assets (generally items that can be used as a tax deduction or credit in future periods) and deferred tax liabilities (generally items for which we receive a tax deduction, but have not yet been recorded in the consolidated statement of operations). We regularly review our deferred tax assets for realizability, taking into consideration all available evidence, both positive and negative, including historical pre-tax and taxable income (losses), projected future pre-tax and taxable income (losses) and the expected timing of the reversals of existing temporary differences. In arriving at these judgments, the weight given to the potential effect of all positive and negative evidence is commensurate with the extent to which it can be objectively verified. Reportable U.S. GAAP income from SunEdison's financing sale-leaseback transactions in the U.S. is deferred until the end of the lease term, generally 20-25 years, through the non-cash extinguishment of the debt.  However, sale-leaseback transactions generate current U.S. taxable income at the time of the sale, with the timing differences increasing deferred tax assets.  As a result of the continued decline in solar market conditions, the restructuring charges announced in December 2011, and cumulative losses in the U.S. and certain foreign jurisdictions, we recorded a material non-cash valuation allowance against the deferred tax assets at December 31, 2011. See Note 14 for further discussion.

We believe our tax positions are in compliance with applicable tax laws and regulations. Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. Uncertain tax benefits, including accrued interest and penalties, are included as a component of other long-term liabilities because we do not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. The accrual of interest begins in the first reporting period that interest would begin to accrue under the applicable tax law. Penalties, when applicable, are accrued in the financial reporting period in which the uncertain tax position is taken on a tax return. We recognize interest and penalties related to uncertain tax positions in income tax expense, which is consistent with our historical policy. We believe that our income tax accrued liabilities, including related interest, are adequate in relation to the potential for additional tax assessments. There is a risk, however, that the amounts ultimately paid upon resolution of audits could be materially different from the amounts previously included in our income tax expense and, therefore, could have a material impact on our tax provision, net (loss) income and cash flows. We review our accrued liabilities quarterly, and we may adjust such liabilities due to proposed assessments by tax authorities, changes in facts and circumstances, issuance of new regulations or new case law, negotiations between tax authorities of different countries concerning our transfer prices between our subsidiaries, the resolution of entire audits, or the expiration of statutes of limitations. Adjustments are most likely to occur in the year during which major audits are closed.

Due to the restructuring announcement made in December 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future. We plan foreign remittance amounts based on projected cash flow needs as well as the working capital and long-term investment requirements of our foreign subsidiaries and our domestic operations.

We have made our best estimates of certain income tax amounts included in the financial statements. Application of our accounting policies and estimates, however, involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. In arriving at our estimates, factors we consider include how accurate the estimate or assumptions have been in the past, how much the estimate or assumptions have changed and how reasonably likely such change may have a material impact.

Stock-Based Compensation

Stock-Based Compensation

Stock-based compensation expense for all share-based payment awards is based on the estimated grant-date fair value. We recognize these compensation costs net of an estimated forfeiture rate for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the option vesting term. For ratable awards, we recognize compensation costs for all grants on a straight-line basis over the requisite service period of the entire award. We estimate the forfeiture rate taking into consideration our historical experience during the preceding four fiscal years.

We routinely examine our assumptions used in estimating the fair value of employee options granted. As part of this assessment, we have determined that our historical stock price volatility and historical pattern of option exercises are appropriate indicators of expected volatility and expected term. The interest rate is determined based on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term of the award. We estimate the fair value of options using the Black-Scholes option-pricing model for our ratable and cliff vesting options. For our market condition awards, the grant date fair value was calculated for these awards using a probabilistic approach under a Monte Carlo simulation taking into consideration volatility, interest rates and expected term.

Contingencies

ontingencies

We are involved in conditions, situations or circumstances in the ordinary course of business with possible gain or loss contingencies that will ultimately be resolved when one or more future events occur or fail to occur. We continually evaluate uncertainties associated with loss contingencies and record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements; and (ii) the loss or range of loss can be reasonably estimated. Legal costs are expensed when incurred. Gain contingencies are not recorded until realized or realizable.

Shipping and Handling

hipping and Handling

Costs to ship products to customers are included in marketing and administration expense in the consolidated statement of operations. Amounts billed to customers, if any, to cover shipping and handling are included in net sales. Cost to ship products to customers were $24.6 million, $22.0 million and $20.7 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Fair Value Measurements

Fair Value Measurements

Fair value accounting guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, and are based on market data obtained from sources independent of MEMC. Unobservable inputs reflect assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

• Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that MEMC has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Because valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

• Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Valuations for Level 2 are prepared on an individual instrument basis using data obtained from recent transactions for identical securities in inactive markets or pricing data from similar instruments in active and inactive markets.

• Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We maintain various financial instruments recorded at cost in the December 31, 2012 and 2011 balance sheets that are not required to be recorded at fair value. For these instruments, we used the following methods and assumptions to estimate the fair value:

• Cash equivalents, restricted cash, accounts receivable and payable, customer deposits, income taxes receivable and payable, short-term borrowings, and accrued liabilities—cost approximates fair value because of the short maturity period; and

• Long-term debt—fair value is based on the amount of future cash flows associated with each debt instrument discounted at our current estimated borrowing rate for similar debt instruments of comparable terms.

Stockholders' Equity Note, Redeemable Preferred Stock, Issue, Policy [Policy Text Block]

Redeemable Noncontrolling Interest

Redeemable noncontrolling interests are equity interests in common stock of consolidated subsidiaries that have redemption features that are not solely within our control. These interests are classified as temporary equity because their redemption is considered probable. These interests are measured at the greater of estimated redemption value at the end of each reporting period or the initial carrying amount of the redeemable noncontrolling interests adjusted for cumulative earnings allocations.  Adjustments to report redeemable noncontrolling interests at estimated redemption value are determined after the attribution of net income or loss of the subsidiary and are recorded to retained earnings, or in the absence of retained earnings, additional paid-in-capital.

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Consolidated Statement of Comprehensive Income (Loss) Statement (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	$ (182.3)	$ (1,556.3)	$ 49.7
Net Income (Loss) Attributable to Noncontrolling Interest	(1.9)	(16.0)	(13.6)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	(2.3)	(1.7)	(0.6)
Net translation adjustment	(18.5)	(2.5)	16.2
Net unrealized (loss) gain on available-for-sale securities	(2.8)	(24.9)	(2.9)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(0.4)	7.1	(11.0)
Net unrecognized actuarial gain and prior service credit, net of tax	(11.9)	(16.0)	(0.6)
Other Comprehensive Income (Loss)	(33.6)	(36.3)	1.7
Net income (loss)	(148.7)	(1,520.0)	48.0
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	$ (186.5)	$ (1,574.0)	$ 35.5

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2012

Accounting Policies [Abstract]

Cash and Cash Equivalents

Cash and cash equivalents consist of the following:

	As of December 31,
	2012		2011
Dollars in millions
Cash	$	514.5	$	417.0
Cash Equivalents:
Commercial paper	10.0		10.0
Money market funds	48.1		158.8
	$	572.6	$	585.8

Property, Plant and Equipment

Property, Plant and Equipment

We record property, plant and equipment at cost and depreciate it evenly over the assets’ estimated useful lives as follows:

	Years
Software	3-6
Buildings and improvements	4-60
Machinery and equipment	1-25
Solar energy systems	23-30

Intangible Assets, Estimated Useful Lives

he estimated useful lives of our intangible assets subject to amortization are as follows:

	Years
Favorable energy credits	4-18
Customer sales backlog and relationships	1-6
Trade name	15
Developed technology	5

Supplemental Cash Flow Information

upplemental Cash Flow Information

Following is information related to interest and taxes paid as well as certain non-cash investing and financing activities including acquisition related items:

	For the year ended December 31,
	2012		2011			2010
In millions
Supplemental disclosures of cash flow information:
Interest payments (including debt issuance costs), net of amounts capitalized	$	170.9	$	155.9		$	22.2
Income taxes paid (refunded), net	40.9		13.7			(9.4		)
Supplemental schedule of non-cash investing and financing activities:
Accounts payable incurred (relieved) for acquisition of fixed assets, including solar energy systems	$	49.7	$	(68.0	)	$	138.7
Debt transferred to and assumed by buyer upon sale of solar energy systems	403.1		104.6			43.3
Conversion of note payable to equity	—		—			27.0
Acquisitions:
Fair value of assets acquired	$	—	$	334.5		$	65.2
Goodwill	—		97.8			56.4
Liabilities assumed and noncontrolling interests	—		(158.0		)	(19.9		)
Loans prior to acquisition	—		(16.0		)	(26.0		)
Other non-cash consideration	—		(90.7		)	—
Less: cash acquired	—		(3.6		)	(2.2		)
Cash paid, net of cash acquired	$	—	$	164.0		$	73.5

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Stockholders' Equity (Weighted-Average Assumptions) (Details)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Stockholders' Equity Note [Abstract]
Risk-free interest rate	0.80%	1.70%	1.80%
Expected stock price volatility	68.10%	65.70%	67.00%
Expected term until exercise (in years)	4	4	4
Expected dividends	0.00%	0.00%	0.00%

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

The carrying values of intangible assets at December 31, 2012 and December 31, 2011 are as follows:

		December 31, 2012							December 31, 2011
Dollars in millions	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount		Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount
Amortizable intangible assets:
Favorable energy credits	7	$	14.2	$	(9.0	)	$	5.2	$	14.2	$	(6.1	)	$	8.1
Customer relationships(1)	6	5.7		(2.4		)	3.3		5.7		(1.6		)	4.1
Trade name	15	4.1		(0.9		)	3.2		4.1		(0.6		)	3.5
Internally developed software	4	1.3		(1.3		)	—		1.7		(1.0		)	0.7
Developed technology(1)	5	12.0		(6.0		)	6.0		13.9		(5.5		)	8.4
Non-compete agreement	1	1.2		(1.2		)	—		1.2		(0.4		)	0.8
Total amortizable intangible assets		$	38.5	$	(20.8	)	$	17.7	$	40.8	$	(15.2	)	$	25.6
Indefinite lived assets:
In-process technology(1)	Indefinite	$	0.9	$	—		$	0.9	$	1.5	$	—		$	1.5
Power plant development arrangements(2)	Indefinite	143.3		(47.7		)	95.6		143.3		(21.2		)	122.1
Total indefinite lived assets		$	144.2	$	(47.7	)	$	96.5	$	144.8	$	(21.2	)	$	123.6

____________________ 

⁽¹⁾  These intangibles represent the amounts acquired in the SunEdison, Solaicx and other acquisitions. The useful life for in-process technology will be determined once the research and development process is complete and, at that time, amortization of the asset will begin.

⁽²⁾  Power plant development arrangements are allocated to the solar energy system (property, plant and equipment or inventory) upon completion of the related solar energy systems stemming from the backlog at the date of acquisition. Depending on the classification of the system, held for development and sale or property, plant and equipment will determine whether the intangible is amortized to cost of goods sold or to depreciation expense. Includes $82.6 million, net of amortization, acquired in the FRV U.S. acquisition.

Expected Annual Amortization Expense

We expect to recognize annual expense on our amortizable intangible assets as follows:

	2013		2014		2015		2016		2017
In millions
Amortization	$	6.9	$	4.4	$	1.7	$	1.2	$	0.5

Changes in Goodwill

Changes in goodwill for the year ended December 31, 2011 are as follows:

In millions	January 1, 2011		Acquisitions (see Note 4)		Impairments			December 31, 2011
Solar Energy	$	342.7	$	97.8	$	(440.5	)	$	—
Total	$	342.7	$	97.8	$	(440.5	)	$	—

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Summary of Significant Accounting Policies (Narrative) (Details) In Millions, unless otherwise specified	0 Months Ended	3 Months Ended		12 Months Ended										12 Months Ended			3 Months Ended	12 Months Ended
	Jun. 27, 2012 USD ($)	Dec. 31, 2012 USD ($) instrument	Dec. 31, 2011 USD ($)	Dec. 31, 2012 USD ($) instrument	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2009 USD ($)	Dec. 31, 2012 Variable Interest Entity, Primary Beneficiary [Member] entity	Dec. 31, 2011 Variable Interest Entity, Primary Beneficiary [Member] entity	Dec. 31, 2012 Consolidated Entities [Member] entity	Dec. 31, 2012 Foreign Subsidiaries [Member] USD ($)	Dec. 31, 2011 Foreign Subsidiaries [Member] USD ($)	Jun. 27, 2012 Subsidiaries [Member]	Dec. 31, 2012 Assets Held under Capital Leases [Member] USD ($)	Dec. 31, 2011 Assets Held under Capital Leases [Member] USD ($)	Dec. 31, 2010 Assets Held under Capital Leases [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] USD ($)	Dec. 31, 2012 Solar Energy [Member] Percentage of Completion Method [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] Percentage of Completion Method [Member] USD ($)	Dec. 31, 2012 Solar Energy [Member] Installment Method [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] Installment Method [Member] USD ($)	Dec. 31, 2012 Solar Energy [Member] Performance Based Incentives [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] Performance Based Incentives [Member] USD ($)	Dec. 31, 2010 Solar Energy [Member] Performance Based Incentives [Member] USD ($)	Dec. 31, 2012 Solar Energy [Member] Renewable Energy Credits [Member] USD ($)	Dec. 31, 2011 Solar Energy [Member] Renewable Energy Credits [Member] USD ($)	Dec. 31, 2010 Solar Energy [Member] Renewable Energy Credits [Member] USD ($)	Dec. 31, 2012 Minimum [Member]	Dec. 31, 2012 Minimum [Member] Solar Energy [Member] Percentage of Completion Method [Member]	Dec. 31, 2012 Minimum [Member] Solar Energy [Member] Renewable Energy Credits [Member]	Dec. 31, 2012 Maximum [Member]	Dec. 31, 2012 Maximum [Member] Solar Energy [Member] Renewable Energy Credits [Member]	Dec. 31, 2011 Q-Cells SE [Member] USD ($)	Dec. 31, 2010 Q-Cells SE [Member] USD ($)	Dec. 31, 2010 Q-Cells SE [Member] EUR (€)	Dec. 31, 2011 Other Income [Member] Q-Cells SE [Member] USD ($)	Dec. 31, 2006 Suntech Warrant [Member] USD ($)
Significant Accounting Policies [Line Items]
Stockholders' Equity Attributable to Noncontrolling Interest		$ 90.8	$ 47.0	$ 90.8	$ 47.0
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners													15.00%
Variable Interest Entity, Number Of Entities								5	3
Number Of Entities Sold										1
Cash and Cash Equivalents, at Carrying Value		572.6	585.8	572.6	585.8	707.3	632.7				171.5	64.2
Allowance for Doubtful Accounts Receivable		4.4	4.9	4.4	4.9
Provision for Doubtful Accounts				0.3	(1.4)	1.4
Equity Method Investment, Minimum Ownership Percentage		20.00%		20.00%
Other than Temporary Impairment Losses, Investments			78.9	3.6	78.9	0											78.9
Depreciation				200.6	217.7	158.9								4.3	9.7	4.5
Interest Costs, Capitalized During Period				19.9	18.1	5.1
Allowance for Doubtful Accounts Receivable, Charge-offs				0.2	4.3	0.7
Assets impairment charges			365.4	20.0	381.7	0											358.0
Impairment of Intangible Assets, Finite-lived				1.2	6.6
Customer Deposits, Required Refund Period				2 years
Customer Deposits, Current		77.2	72.4	77.2	72.4
Customer and other deposits		184.5	276.8	184.5	276.8
Revenues				1,794.6	2,268.0	1,996.4												97.8	54.3	22.7	28.5	31.4	24.3	18.6	17.3	15.1	7.5
Revenue Recognition, Construction Period																													3 months
Capital Lease Classification, Term of Lease To Estimated Economic Life, Percent																												75.00%
Revenue Recogniztion, Contractual Arrangements, Period																														5 years		10 years
Derivative Instruments, Exercisable Period																																					5 years
Derivative Instruments, Exercise Period																																					5 years
Derivative Instruments, Exercisable Annual Percentage																																					20.00%
Derivative Instruments, Estimated Grant Date Fair Value																																					66.6
Foreign Currency Transaction Loss, before Tax				6.6	4.7	0.5
Number of Interest Rate Derivatives Held		4		4
Payments to Acquire Equity Method Investments				47.8	50.4	18.8																												105.0	72.5
Notional Amount of Foreign Currency Cash Flow Hedge Derivatives																																			70.0
Gain on Discontinuation of Cash Flow Hedge Due to Forecasted Transaction Probable of Not Occurring																																				17.3
Income (Loss) from Equity Method Investments				(2.3)	(62.8)	7.2																											14.3
Lease Term Period																												20 years			25 years
Deferred Tax Assets, Valuation Allowance		510.5	415.7	510.5	415.7
Percentage That Tax Position More Likely Than Not To Be Realized																												50.00%
Shipping, Handling and Transportation Costs				24.6	22.0	20.7
Proceeds from Issuance of Redeemable Noncontrolling Interest, Net	11.4
Payments of Stock Issuance Costs	1.4
Temporary Equity, Accretion to Redemption Value		1.6
Equity Investment from JV Partners		$ 34.0		$ 34.0

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Goodwill and Intangible Assets (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended			3 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 FRV US [Member]	Sep. 30, 2011 Solar Materials Unit [Member]
Intangible Assets [Line Items]
Goodwill, Impairment Loss	$ 384.1	$ 0	$ 440.5	$ 0	$ 44.6	$ 56.4
Amortization of Intangible Assets		34.6	9.4	5.9
Impairment of Intangible Assets, Finite-lived		$ 1.2	$ 6.6

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Consolidated Statements of Operations (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net sales	$ 2,529.9	$ 2,715.5	$ 2,239.2
Cost of goods sold	2,194.3	2,420.6	1,902.1
Gross profit	335.6	294.9	337.1
Operating expenses:
Marketing and administration	306.2	352.8	267.0
Research and development	71.8	87.5	55.6
Goodwill impairment charges	0	440.5	0
Restructuring (Reversals) Charges	(83.5)	350.7	5.3
Gain on Receipt of Property Plant and Equipment	(31.7)	0	0
Long-lived asset impairment charges	19.6	367.9	0
Insurance recovery	(4.0)	(4.0)	(11.9)
Operating (loss) income	57.2	(1,300.5)	21.1
Non-operating expense (income):
Interest expense	135.3	77.2	29.0
Interest income	(3.6)	(4.5)	(5.5)
Decline (increase) in fair value of warrant	0.2	4.8	14.0
Other, net	6.8	6.1	(3.9)
Total non-operating expense (income)	138.7	83.6	33.6
Loss before income tax expense (benefit) and equity in (loss) earnings of joint ventures	(81.5)	(1,384.1)	(12.5)
Income tax expense (benefit)	64.9	73.1	(53.3)
(Loss) income before equity in earnings (loss) of joint venture	(146.4)	(1,457.2)	40.8
Equity in (loss) earnings of joint ventures, net of tax	(2.3)	(62.8)	7.2
Net (loss) income	(148.7)	(1,520.0)	48.0
Net Income (Loss) Attributable to Noncontrolling Interest	(1.9)	(16.0)	(13.6)
Net (loss) income attributable to MEMC stockholders	$ (150.6)	$ (1,536.0)	$ 34.4
Basic (loss) income per share (see Note 13)	$ (0.66)	$ (6.68)	$ 0.15
Diluted (loss) income per share (see Note 13)	$ (0.66)	$ (6.68)	$ 0.15

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Employee Related Liabilities (Tables)

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

Schedule of Net Benefit Costs

Net periodic post-retirement benefit cost (income) consists of the following:

	Pension Plans									Health Care and Other Plans
Year ended December 31,	2012			2011			2010			2012			2011			2010
In millions
Service cost	$	1.1		$	2.9		$	2.9		$	—		$	—		$	—
Interest cost	7.8			9.4			9.6			0.8			1.1			1.4
Expected return on plan assets	(13.8		)	(15.4		)	(14.3		)	—			—			—
Amortization of prior service cost	—			—			—			(0.7		)	(0.5		)	(0.5		)
Net actuarial loss (gain)	4.1			7.9			8.5			(0.5		)	(1.5		)	(1.6		)
Settlement charges	6.7			—			—			—			—			—
Net periodic benefit cost (income)	$	5.9		$	4.8		$	6.7		$	(0.4	)	$	(0.9	)	$	(0.7	)

Schedule Of Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost

The following is a table of actuarial assumptions used to determine the net periodic benefit cost (income):

	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012		2011		2010		2012		2011		2010
Weighted-average assumptions:
Discount rate	3.65	%	4.58	%	5.18	%	3.93	%	5.09	%	5.65	%
Expected return on plan assets	8.34	%	8.36	%	8.38	%	NA		NA		NA
Rate of compensation increase	3.62	%	3.63	%	3.73	%	3.75	%	3.75	%	3.75	%
Current medical cost trend rate	NA		NA		NA		8.00	%	8.00	%	8.00	%
Ultimate medical cost trend rate	NA		NA		NA		5.00	%	5.00	%	5.75	%
Year the rate reaches ultimate trend rate	NA		NA		NA		2018		2017		2016

Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets

The following summarizes the change in benefit obligation, change in plan assets, and funded status of the plans:

	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012			2011			2012			2011
In millions
Change in benefit obligation:
Benefit obligation at beginning of year	$	227.2		$	213.3		$	20.1		$	23.0
Service cost	1.1			2.9			—			—
Interest cost	7.8			9.4			0.8			1.1
Plan participants’ contributions	—			—			0.5			0.8
Plan amendments	—			—			—			(3.9		)
Actuarial loss	17.8			19.0			2.3			1.1
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Settlements	(21.0		)	(2.1		)	—			—
Currency exchange gain	(0.7		)	(0.4		)	—			—
Benefit obligation at end of year	$	223.5		$	227.2		$	21.5		$	20.1
Change in plan assets:
Fair value of plan assets at beginning of year	$	176.0		$	192.2		$	—		$	—
Actual (loss) gain on plan assets	22.3			(2.4		)	—			—
Employer contributions	0.6			1.5			1.7			1.2
Plan participants’ contributions	—			—			0.5			0.8
Settlements	(18.5		)	—			—			—
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Currency exchange (loss) gain	0.1			(0.4		)	—			—
Fair value of plan assets at end of year	$	171.8		$	176.0		$	—		$	—
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)
Amounts recognized in statement of financial position:
Other assets, noncurrent	$	—		$	—		$	—		$	—
Accrued liabilities, current	(0.6		)	(0.7		)	(1.4		)	(1.2		)
Pension and post-employment liabilities, noncurrent	(51.1		)	(50.5		)	(20.1		)	(18.9		)
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)

Schedule of Amounts Recognized in Other Comprehensive Income (Loss)

Amounts recognized in accumulated other comprehensive (loss) income (before tax):

	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012			2011
In millions
Net actuarial loss (gain)	$	86.8	$	88.2	$	(0.3	)	$	(3.1	)
Prior service credit	—		—		(12.1		)	(12.8		)
Net amount recognized	$	86.8	$	88.2	$	(12.4	)	$	(15.9	)

Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) to be Recognized over Next Fiscal Year

The estimated amounts that will be amortized from accumulated other comprehensive (loss) income into net periodic benefit cost (income) in 2013 are as follows:

	Pension Plans		Health Care and Other Plans
In millions
Actuarial loss	$	2.6	$	—
Prior service credit	—		(0.7		)
Total	$	2.6	$	(0.7	)

Schedule Of Weighted Average Assumptions Used in Calculating Benefit Obligation

The following is a table of the actuarial assumptions used to determine the benefit obligation:

	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012		2011
Weighted-average assumptions:
Discount rate	3.14	%	3.65	%	3.37	%	3.95	%
Rate of compensation increase	—	%	3.62	%	3.75	%	3.75	%

Schedule of Allocation of Plan Assets

The U.S. pension plan assets are invested primarily in marketable securities, including common stocks, bonds and interest-bearing deposits. The weighted-average allocation of pension benefit plan assets at year ended December 31 were as follows:

			Actual Allocation				Fair Value
Asset Category (Dollars in millions)	2012 Target Allocation		2012		2011		2012		2011
Cash	—	%	32	%	15	%	$	53.7	$	24.8
Equity securities	60	%	55	%	61	%	92.9		105.2
Fixed income securities	40	%	13	%	24	%	21.9		41.6
Total	100	%	100	%	100	%	$	168.5	$	171.6

Schedule Of Fair Value of Plan Assets

Asset Category (In millions)	Asset Value as of December 31, 2012		Asset Value as of December 31, 2011
Cash and cash equivalents	$	53.7	$	24.8
Equity securities:
U.S. large cap	38.5		50.9
Mid cap	11.1		11.9
Small cap	11.0		11.3
International	22.0		21.3
Emerging markets	10.3		9.8
Fixed income:
Investment grade bonds	8.3		15.8
Corporate bonds	13.6		25.8
Total	$	168.5	$	171.6

Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets

he projected benefit obligation, accumulated benefit obligation and fair value of plan assets for pension plans with an accumulated benefit obligation in excess of plan assets were as follows:

	Pension Plans
	2012		2011
In millions
Projected benefit obligation, end of year	$	223.5	$	227.2
Accumulated benefit obligation, end of year	$	212.5	$	216.2
Fair value of plan assets, end of year	$	171.8	$	176.0

Schedule of Expected Benefit Payments

We estimate that the future benefits payable for the pension and other post-retirement plans are as follows:

	Pension Plans		Health Care and Other Plans
In millions
2013	$	18.4	$	1.4
2014	$	12.2	$	1.6
2015	$	12.0	$	1.5
2016	$	12.5	$	1.4
2017	$	12.3	$	1.4
2018-2022	$	61.4	$	6.5

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Revenue and Profit Deferrals (Schedule of Deferred Revenue and Profit) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Deferred Revenue Arrangement [Line Items]
Deferred revenue for solar energy systems	$ 113.1	$ 41.4
Total deferred revenue	288.3	250.7
Solar Energy [Member]
Deferred Revenue Arrangement [Line Items]
Deferred revenue for solar energy systems	113.1	41.4
Profit deferrals on solar energy system sales	126.4	138.0
Deferred subsidy revenue	19.6	19.4
Total deferred revenue	259.1	198.8
Semiconductor and Solar Materials [Member]
Deferred Revenue Arrangement [Line Items]
Short-term deferred revenue	0	0.7
Long-term deferred revenue	29.2	51.2
Total deferred revenue	$ 29.2	$ 51.9

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Consolidated Statements of Stockholders' Equity (USD $) In Millions, unless otherwise specified	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Common Stock Held in Treasury [Member]	Total MEMC Stockholders' Equity [Member]	Noncontrolling Interest [Member]	Redeemable noncontrolling interest [Member]
Balance at Dec. 31, 2009	$ 2,206.8	$ 2.4	$ 507.4	$ 2,079.1	$ 33.0	$ (453.3)	$ 2,168.6	$ 38.2
Shares, Issued at Dec. 31, 2009		237.2				(9.8)
Comprehensive income:
Net (loss) income	48.0			34.4			34.4	13.6
Net translation adjustment	16.2				15.6		15.6	0.6
Net unrecognized actuarial gain and prior service credit, net of tax	(0.6)				(0.6)		(0.6)
Gain (Loss) on mark to market for cash flow hedges	(11.0)				(11.0)		(11.0)
Net unrealized (loss) gain on available-for-sale securities	(2.9)				(2.9)		(2.9)
Total comprehensive income	49.7						35.5	14.2
Stock plans, net	47.6		50.5			(2.9)	47.6
Stock plans, net (in shares)		0.7				(0.2)
Net repayments to noncontrolling interest	(8.5)							(8.5)
Balance at Dec. 31, 2010	2,295.6	2.4	557.9	2,113.5	34.1	(456.2)	2,251.7	43.9
Shares, Issued at Dec. 31, 2010		237.9				(10.0)
Acquired Noncontrolling Interest	39.7							39.7
Purchase of SunEdison	24.5		24.5				24.5
Purchase of SunEdison LLC (in shares)		2.1
Comprehensive income:
Net (loss) income	(1,520.0)			(1,536.0)	0		(1,536.0)	16.0
Net translation adjustment	(2.5)				(4.2)		(4.2)	1.7
Net unrecognized actuarial gain and prior service credit, net of tax	(16.0)				(16.0)		(16.0)
Gain (Loss) on mark to market for cash flow hedges	7.1				7.1		7.1
Net unrealized (loss) gain on available-for-sale securities	(24.9)				(24.9)		(24.9)
Total comprehensive income	(1,556.3)						(1,574.0)	17.7
Stock plans, net	36.8		40.4			(3.6)	36.8
Stock plans, net (in shares)		1.3				(0.5)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(55.4)		(1.1)				(1.1)	(54.3)
Redeemable noncontrolling interest, Carrying Amount	0
Balance at Dec. 31, 2011	784.9	2.4	621.7	577.5	(3.9)	(459.8)	737.9	47.0
Shares, Issued at Dec. 31, 2011		241.3				(10.5)
Temporary Equity, Net Income									(0.3)
Temporary Equity, Accretion to Redemption Value									1.6
Increase in Carrying Amount of Redeemable Noncontrolling Interest	(1.6)						(1.6)
Temporary Equity, Stock Issued During Period, Value, New Issues									10.0
Comprehensive income:
Net (loss) income	(148.7)			(150.6)			(150.6)	1.9
Net translation adjustment	(18.5)				(20.8)		(20.8)	2.3
Net unrecognized actuarial gain and prior service credit, net of tax	(11.9)				(11.9)		(11.9)
Gain (Loss) on mark to market for cash flow hedges	(0.4)				(0.4)		(0.4)
Net unrealized (loss) gain on available-for-sale securities	(2.8)				(2.8)		(2.8)
Total comprehensive income	(182.3)						(186.5)	4.2
Stock plans, net	25.5		26.0			(0.5)	25.5
Stock plans, net (in shares)		0.6				0.1
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	39.6							39.6
Redeemable noncontrolling interest, Carrying Amount	11.3								11.3
Balance at Dec. 31, 2012	$ 666.1	$ 2.4	$ 647.7	$ 425.3	$ (39.8)	$ (460.3)	$ 575.3	$ 90.8
Shares, Issued at Dec. 31, 2012		241.9				(10.6)

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Employee Related Liabilities (Narrative) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended													12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 United States Pension Plans of US Entity, Defined Benefit [Member]	Dec. 31, 2011 United States Pension Plans of US Entity, Defined Benefit [Member]	Dec. 31, 2012 Pension Plans [Member]	Dec. 31, 2011 Pension Plans [Member]	Dec. 31, 2010 Pension Plans [Member]	Jan. 02, 2002 Pension Plans [Member] employee	Dec. 31, 2012 Other Postretirement Benefit Plans, Defined Benefit [Member]	Dec. 31, 2011 Other Postretirement Benefit Plans, Defined Benefit [Member]	Dec. 31, 2010 Other Postretirement Benefit Plans, Defined Benefit [Member]	Jan. 02, 2002 Postretirement Medical Benefits Plan [Member] employee	Dec. 31, 2012 United States Pension Plans of US Entity, Defined Benefit [Member]	Dec. 31, 2011 United States Pension Plans of US Entity, Defined Benefit [Member]	Dec. 31, 2012 End Of Service Entitlement, Japan And Italy [Member]	Dec. 31, 2011 End Of Service Entitlement, Japan And Italy [Member]	Dec. 31, 2012 Fair Value, Inputs, Level 3 [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Number Of New Participants To Be Added To Plan									0				0
Defined Benefit Plan, Expected Return on Plan Assets, Percent														8.50%	8.50%
Defined Benefit Plan, Actual Return on Plan Assets, Percent														12.80%	(1.30%)
Pension Contributions	$ 0.6	$ 1.5
Other Postretirement Benefits Payments	1.7	1.2
Defined Benefit Plan, Assets for Plan Benefits, Noncurrent				(19.5)	(19.1)	0	0			0	0
Defined Benefit Plan, Accumulated Benefit Obligation				187.9
Defined Benefit Plan, Fair Value of Plan Assets	168.5	171.6		168.4		171.8	176.0	192.2		0	0	0						53.7
Defined Benefit Plan, Estimated Future Employer Contributions in Next Fiscal Year						0				1.4
Defined Contribution Plan, Cost Recognized	9.1	9.4	6.1
Deferred Compensation Arrangement with Individual, Recorded Liability																$ 21.6	$ 20.9

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Significant Accounting Policies (Details)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2012 Software [Member] Y	Dec. 31, 2012 Building and improvements [Member] Y	Dec. 31, 2012 Machinery and Equipment [Member] Y	Dec. 31, 2012 Solar Energy Systems [Member] Y	Dec. 31, 2012 Favorable Energy Credits [Member] Y	Dec. 31, 2012 Customer Sales Backlog and Relationships [Member] Y	Dec. 31, 2012 Trade Names [Member] Y	Dec. 31, 2012 Developed Technology Rights [Member] Y	Dec. 31, 2012 Minimum [Member]	Dec. 31, 2012 Minimum [Member] Solar Energy [Member] Percentage of Completion Method [Member]	Dec. 31, 2012 Minimum [Member] Solar Energy [Member] Renewable Energy Credits [Member]	Dec. 31, 2012 Maximum [Member]	Dec. 31, 2012 Maximum [Member] Solar Energy [Member] Renewable Energy Credits [Member]	Dec. 31, 2006 Suntech Warrant [Member]
Property, Plant and Equipment [Line Items]
Customer Deposits, Required Refund Period	2 years
Derivative Instruments, Exercisable Period															5 years
Property, Plant and Equipment, Useful Life, Minimum		3	4	1	23
Property, Plant and Equipment, Useful Life, Maximum		6	60	25	30
Finite-Lived Intangible Assets, Useful Life, Minimum						4	1
Finite-Lived Intangible Assets, Useful Life, Maximum						18	6
Finite-Lived Intangible Assets, Useful Life								15	5
Revenue Recognition, Construction Period											3 months
Derivative Instruments, Exercise Period															5 years
Revenue Recogniztion, Contractual Arrangements, Period												5 years		10 years
Lease Term Period										20 years			25 years

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Fair Value Measurements (Narrative) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2011 SunEdison [Member]	Feb. 01, 2011 SunEdison [Member]	Dec. 31, 2012 Carrying (Reported) Amount, Fair Value Disclosure [Member]	Dec. 31, 2011 Carrying (Reported) Amount, Fair Value Disclosure [Member]	Dec. 31, 2012 Estimate of Fair Value, Fair Value Disclosure [Member]	Dec. 31, 2011 Estimate of Fair Value, Fair Value Disclosure [Member]	Dec. 31, 2012 Suntech Warrant [Member]	Dec. 31, 2012 Gintech [Member] Maximum [Member]	Dec. 31, 2012 Forward Contracts [Member]	Dec. 31, 2011 Forward Contracts [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investment Owned, Percent of Common Stock										10.00%
Derivative Asset, Notional Amount									$ 205.8
Assets, Fair Value Disclosure											6.6
Liabilities, Fair Value Disclosure												1.2
Business acquisition, contingent consideration	24.9
Contingent Consideration Common Stock Issued				2.1
Fair Value, Level 1 to level 2 Transfers, Amount	0
Fair Value, Level 2 to level 1 Transfers, Amount		0	80.2
Debt Instrument, Fair Value Disclosure					$ 2,368.3	$ 1,926.8	$ 1,736.2	$ 1,333.6

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Derivatives and Hedging Instruments (Tables)

12 Months Ended

Dec. 31, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location

MEMC’s hedging activities consist of:

		Assets (Liabilities or Equity) Fair Value
In millions	Balance Sheet Location	As of December 31, 2012			As of December 31, 2011
Derivatives designated as hedging:
Interest rate swaps	Accrued liabilities	$	(5.0	)	$	(4.5	)
Interest rate swaps	Accumulated other comprehensive income	$	4.3		$	3.9
Derivatives not designated as hedging:
Suntech warrant	Other assets	$	0.2		$	0.4
Currency forward contracts	Prepaid and other current assets	$	0.5		$	3.0
Currency forward contracts	Accrued liabilities	$	(7.1	)	$	(1.8	)
Interest rate swaps	Accrued liabilities	$	—		$	(1.1	)
		Losses (Gain)
In millions	Statement of Operations Location	Year Ended December 31, 2012			Year Ended December 31, 2011			Year Ended December 31, 2010
Derivatives designated as hedging:
Net investment hedge	Other, net	$	—		$	—		$	(17.3	)
Derivatives not designated as hedging:
Suntech warrant	Decline in fair value of warrant	$	0.2		$	4.8		$	14.0
Currency forward contracts	Other, net	$	9.0		$	7.4		$	1.3

Schedule of Interest Rate Derivatives

	Notional Amount (in millions)	Fixed Rate	Variable Rate	Termination Date	Assets (Liabilities) Fair Value at December 31, 2012
					Dollars in millions
Interest rate swap #1 cash flow hedge	4.4 Euros	5.1%	Euribor plus 1.5%	6/30/2023	$	(1.7	)
Interest rate swap #2 cash flow hedge	1.8 Euros	5.1%	Euribor plus 1.5%	6/30/2023	(0.7		)
Interest rate swap #3 cash flow hedge	32.4 Canadian Dollars	3.3%	Canadian Deposit Offering Rate	6/5/2028	(2.6		)
Interest rate swap #4 economic hedge	11.5 South African Rand	5.25%	ZAR-JIBAR-SAFEX Rate	3/31/2024	—
					$	(5.0	)

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Investments (Short-Term and Long-Term Investments) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Investments [Abstract]
Equity method investments	$ 23.3	$ 25.8
Equity investments at cost	12.9	12.5
Items measured at fair value on a recurring basis	13.4	16.2
Time deposits	0.3	0.3
Total investments	49.9	54.8
Less: short-term investments	0.3	0.3
Non-current investments	$ 49.6	$ 54.5

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(Loss) Earnings Per Share

12 Months Ended

Dec. 31, 2012

Earnings Per Share [Abstract]

(LOSS) EARNINGS PER SHARE

(LOSS) EARNINGS PER SHARE

In 2012, 2011 and 2010, basic and diluted (loss) earnings per share (EPS) were calculated as follows:

	2012						2011						2010
	Basic			Diluted			Basic			Diluted			Basic		Diluted
In millions, except per share amounts
EPS Numerator:
Net (loss) income attributable to common stockholders	$	(150.6	)	$	(150.6	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
Adjustment of redeemable noncontrolling interest	(1.6		)	(1.6		)	—			—			—		—
Adjusted net (loss) income to common stockholders	$	(152.2	)	$	(152.2	)	$	(1,536.0	)	$	(1,536.0	)	$	34.4	$	34.4
EPS Denominator:
Weighted-average shares outstanding	230.9			230.9			229.9			229.9			226.9		226.9
Stock options and restricted stock units	—			—			—			—			—		1.2
Common stock related to acquisitions	—			—			—			—			—		2.1
Total shares	230.9			230.9			229.9			229.9			226.9		230.2
(Loss) earnings per share	$	(0.66	)	$	(0.66	)	$	(6.68	)	$	(6.68	)	$	0.15	$	0.15

Common stock related to acquisitions reflects the impact of the SunEdison contingent consideration as discussed in Note 19.

As part of the acquisition agreement for SunEdison, a portion of the shares issued in conjunction with the purchase were held in escrow. During the third quarter of 2011, the majority of those shares and cash held in escrow were released. Additional shares and cash were released in 2012 and the remaining shares and cash are scheduled to be released from escrow, if at all, in 2013.

In 2012 and 2011, all options to purchase MEMC stock and restricted stock units were excluded from the calculation of diluted EPS because the effect was antidilutive due to the net loss incurred for the respective periods. In 2010, options and restricted stock units to purchase 15.5 million shares of MEMC stock were excluded from the calculation of diluted EPS because the effect was antidilutive.

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Investments (Tables)

12 Months Ended

Dec. 31, 2012

Investments [Abstract]

Short-Term and Long-Term Investments

The carrying value of short-term and long-term investments consists of the following:

	As of December 31,
	2012		2011
In millions
Equity method investments	$	23.3	$	25.8
Equity investments at cost	12.9		12.5
Items measured at fair value on a recurring basis	13.4		16.2
Time deposits	0.3		0.3
Total investments	49.9		54.8
Less: short-term investments	0.3		0.3
Non-current investments	$	49.6	$	54.5

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Fair Value Measurements (Financial Instruments Measured at Fair Value on Recurring Basis) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Currency Forward Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	$ (6.6)
Liabilities, Fair Value Disclosure		1.2
Fair Value Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets Liabilities Fair Value Disclosure	(22.9)	(78.6)
Fair Value Measurements, Recurring [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets Liabilities Fair Value Disclosure	(6.6)	1.2
Fair Value Measurements, Recurring [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets Liabilities Fair Value Disclosure	8.4	10.6
Fair Value Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets Liabilities Fair Value Disclosure	(24.7)	(90.4)
Fair Value Measurements, Recurring [Member] | Interest Rate Swaps and Option Thereon [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	(5.0)	(5.6)
Fair Value Measurements, Recurring [Member] | Interest Rate Swaps and Option Thereon [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Interest Rate Swaps and Option Thereon [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	(5.0)	(5.6)
Fair Value Measurements, Recurring [Member] | Interest Rate Swaps and Option Thereon [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Currency Forward Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	(6.6)
Liabilities, Fair Value Disclosure		1.2
Fair Value Measurements, Recurring [Member] | Currency Forward Contracts [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	(6.6)
Liabilities, Fair Value Disclosure		1.2
Fair Value Measurements, Recurring [Member] | Currency Forward Contracts [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0
Liabilities, Fair Value Disclosure		0
Fair Value Measurements, Recurring [Member] | Currency Forward Contracts [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0
Liabilities, Fair Value Disclosure		0
Fair Value Measurements, Recurring [Member] | Contingent Consideration Related to Acquisitions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	(24.9)	(90.8)
Fair Value Measurements, Recurring [Member] | Contingent Consideration Related to Acquisitions [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Contingent Consideration Related to Acquisitions [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Contingent Consideration Related to Acquisitions [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, Fair Value Disclosure	(24.9)	(90.8)
Fair Value Measurements, Recurring [Member] | Available for Sale Investments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	13.4	16.2
Fair Value Measurements, Recurring [Member] | Available for Sale Investments [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Available for Sale Investments [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	13.4	16.2
Fair Value Measurements, Recurring [Member] | Available for Sale Investments [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Suntech Warrant [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0.2	0.4
Fair Value Measurements, Recurring [Member] | Suntech Warrant [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Suntech Warrant [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0	0
Fair Value Measurements, Recurring [Member] | Suntech Warrant [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	$ 0.2	$ 0.4

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Employee Related Liabilities

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

EMPLOYEE-RELATED LIABILITIES

EMPLOYEE-RELATED LIABILITIES

Pension and Other Post-Employment Benefit Plans

Prior to January 2, 2002, our defined benefit pension plan covered most U.S. employees. Benefits for this plan were based on years of service and qualifying compensation during the final years of employment. Effective January 2, 2002, we amended our defined benefit plan to discontinue future benefit accruals for certain participants. In addition, effective January 2, 2002, no new participants will be added to the plan. Effective January 1, 2012, the accumulation of new benefits for all participants under our defined benefit pension plan was frozen. This change did not have a material impact on the Company's financial statements because the plan was frozen to new participants in 2001 and combined with turnover, the level of active participants was not significant.

We also have a non-qualified plan under the Employee Retirement Income Security Act of 1974. This plan provides benefits in addition to the defined benefit plan. Eligibility for participation in this plan requires coverage under the defined benefit plan and other specific circumstances. The non-qualified plan has also been amended to discontinue future benefit accruals.

Prior to January 1, 2002, our health care plan provided post-retirement medical benefits to full-time U.S. employees who met minimum age and service requirements. The plan is contributory, with retiree contributions adjusted annually, and contains other cost-sharing features such as deductibles and coinsurance. Effective January 1, 2002, we amended our health care plan to discontinue eligibility for post-retirement medical benefits for certain participants. In addition, effective January 2, 2002, no new participants will be eligible for post-retirement medical benefits under the plan.

Effective January 1, 2012, the amortization period for the unamortized unrealized loss was changed to the remaining life expectancy of the plan participants, which was derived from an actuarial mortality table. This change was triggered since substantially all the plan participants are now inactive/retired. Prior to 2012, the amortization period was derived based on the average remaining service period of the active participants expected to receive benefits. This change has reduced the amortization expense related to the unrealized loss.

Net periodic post-retirement benefit cost (income) consists of the following:

	Pension Plans									Health Care and Other Plans
Year ended December 31,	2012			2011			2010			2012			2011			2010
In millions
Service cost	$	1.1		$	2.9		$	2.9		$	—		$	—		$	—
Interest cost	7.8			9.4			9.6			0.8			1.1			1.4
Expected return on plan assets	(13.8		)	(15.4		)	(14.3		)	—			—			—
Amortization of prior service cost	—			—			—			(0.7		)	(0.5		)	(0.5		)
Net actuarial loss (gain)	4.1			7.9			8.5			(0.5		)	(1.5		)	(1.6		)
Settlement charges	6.7			—			—			—			—			—
Net periodic benefit cost (income)	$	5.9		$	4.8		$	6.7		$	(0.4	)	$	(0.9	)	$	(0.7	)

In 2012, the MEMC pension plans experienced significant lump sum payment activity related to the 2011 global reduction in force previously described in Note 3. This event triggered settlement accounting with both the US and foreign plans because there were significant pension benefit obligations settled during 2012.

To determine pension and other post-retirement and post-employment benefit measurements for the plans, we use a measurement date of December 31. The following is a table of actuarial assumptions used to determine the net periodic benefit cost (income):

	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012		2011		2010		2012		2011		2010
Weighted-average assumptions:
Discount rate	3.65	%	4.58	%	5.18	%	3.93	%	5.09	%	5.65	%
Expected return on plan assets	8.34	%	8.36	%	8.38	%	NA		NA		NA
Rate of compensation increase	3.62	%	3.63	%	3.73	%	3.75	%	3.75	%	3.75	%
Current medical cost trend rate	NA		NA		NA		8.00	%	8.00	%	8.00	%
Ultimate medical cost trend rate	NA		NA		NA		5.00	%	5.00	%	5.75	%
Year the rate reaches ultimate trend rate	NA		NA		NA		2018		2017		2016

The following summarizes the change in benefit obligation, change in plan assets, and funded status of the plans:

	Pension Plans						Health Care and Other Plans
Year ended December 31,	2012			2011			2012			2011
In millions
Change in benefit obligation:
Benefit obligation at beginning of year	$	227.2		$	213.3		$	20.1		$	23.0
Service cost	1.1			2.9			—			—
Interest cost	7.8			9.4			0.8			1.1
Plan participants’ contributions	—			—			0.5			0.8
Plan amendments	—			—			—			(3.9		)
Actuarial loss	17.8			19.0			2.3			1.1
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Settlements	(21.0		)	(2.1		)	—			—
Currency exchange gain	(0.7		)	(0.4		)	—			—
Benefit obligation at end of year	$	223.5		$	227.2		$	21.5		$	20.1
Change in plan assets:
Fair value of plan assets at beginning of year	$	176.0		$	192.2		$	—		$	—
Actual (loss) gain on plan assets	22.3			(2.4		)	—			—
Employer contributions	0.6			1.5			1.7			1.2
Plan participants’ contributions	—			—			0.5			0.8
Settlements	(18.5		)	—			—			—
Gross benefits paid	(8.7		)	(14.9		)	(2.2		)	(2.0		)
Currency exchange (loss) gain	0.1			(0.4		)	—			—
Fair value of plan assets at end of year	$	171.8		$	176.0		$	—		$	—
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)
Amounts recognized in statement of financial position:
Other assets, noncurrent	$	—		$	—		$	—		$	—
Accrued liabilities, current	(0.6		)	(0.7		)	(1.4		)	(1.2		)
Pension and post-employment liabilities, noncurrent	(51.1		)	(50.5		)	(20.1		)	(18.9		)
Net amount recognized	$	(51.7	)	$	(51.2	)	$	(21.5	)	$	(20.1	)

Amounts recognized in accumulated other comprehensive (loss) income (before tax):

	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012			2011
In millions
Net actuarial loss (gain)	$	86.8	$	88.2	$	(0.3	)	$	(3.1	)
Prior service credit	—		—		(12.1		)	(12.8		)
Net amount recognized	$	86.8	$	88.2	$	(12.4	)	$	(15.9	)

The estimated amounts that will be amortized from accumulated other comprehensive (loss) income into net periodic benefit cost (income) in 2013 are as follows:

	Pension Plans		Health Care and Other Plans
In millions
Actuarial loss	$	2.6	$	—
Prior service credit	—		(0.7		)
Total	$	2.6	$	(0.7	)

The following is a table of the actuarial assumptions used to determine the benefit obligation:

	Pension Plans				Health Care and Other Plans
As of December 31,	2012		2011		2012		2011
Weighted-average assumptions:
Discount rate	3.14	%	3.65	%	3.37	%	3.95	%
Rate of compensation increase	—	%	3.62	%	3.75	%	3.75	%

The composition of our plans and age of our participants are such that, as of December 31, 2012 and 2011, the medical cost trend rate no longer has a significant effect on the valuation of our health care plans.

The U.S. pension plan assets are invested primarily in marketable securities, including common stocks, bonds and interest-bearing deposits. The weighted-average allocation of pension benefit plan assets at year ended December 31 were as follows:

			Actual Allocation				Fair Value
Asset Category (Dollars in millions)	2012 Target Allocation		2012		2011		2012		2011
Cash	—	%	32	%	15	%	$	53.7	$	24.8
Equity securities	60	%	55	%	61	%	92.9		105.2
Fixed income securities	40	%	13	%	24	%	21.9		41.6
Total	100	%	100	%	100	%	$	168.5	$	171.6

Asset Category (In millions)	Asset Value as of December 31, 2012		Asset Value as of December 31, 2011
Cash and cash equivalents	$	53.7	$	24.8
Equity securities:
U.S. large cap	38.5		50.9
Mid cap	11.1		11.9
Small cap	11.0		11.3
International	22.0		21.3
Emerging markets	10.3		9.8
Fixed income:
Investment grade bonds	8.3		15.8
Corporate bonds	13.6		25.8
Total	$	168.5	$	171.6

The investment objectives of our pension plan assets are as follows:

• To achieve a favorable relative return as compared with inflation;

• To achieve an above average total rate of return relative to capital markets;

• Preservation of capital through a broad diversification among asset classes which react, as nearly as possible, independently to varying economic and market circumstances; and

• Long-term growth, with a degree of emphasis on stable growth, rather than short-term capital gains.

Our pension cost (income) and pension liabilities are actuarially determined, and we use various actuarial assumptions, including the discount rate, rate of salary increase, and expected return on plan assets to estimate our pension cost (income) and obligations. We determine the expected return on plan assets based on our pension plans’ intended long-term asset mix. The expected investment return assumption used for the pension plans reflects what the plans can reasonably expect to earn over a long-term period considering plan target allocations. The expected return includes an inflation assumption and adds real returns for the asset mix and a premium for active management, and subtracts expenses. While the assumed expected rate of return on the U.S. pension plan assets in 2012 and 2011 was 8.5% and 8.5%, respectively, the actual return experienced in our pension plan assets in the comparable periods in 2012 and 2011 was 12.8% and (1.3)%, respectively. We consult with the plans’ actuaries to determine a discount rate assumption for pension and other post-retirement and post-employment plans that reflects the characteristics of our plans, including expected cash outflows from our plans, and utilize an analytical tool that incorporates the concept of a hypothetical yield curve.

Our pension obligations are funded in accordance with provisions of federal law. Contributions to our pension and post-employment plans in 2012 totaled $0.6 million and $1.7 million, respectively, and in 2011 totaled $1.5 million and $1.2 million, respectively. The funding status of our U.S pension plan was underfunded by $19.5 million and $19.1 million as of December 31, 2012 and December 31, 2011, respectively, and recorded in pension and post-employment liabilities. Our foreign pension plans and health care and other plans continue to maintain an underfunded status as of December 31, 2012 and 2011 and are recorded in pension and post-employment liabilities. As of December 31, 2012, the accumulated benefit obligation for our U.S. pension plan was $187.9 million and the fair value of plan assets was $168.4 million. We expect contributions to our pension and post-employment plans in 2013 to be approximately $0.0 million and $1.4 million, respectively.

MEMC uses appropriate valuation techniques based on the available inputs to measure the fair value of its investments. When available, MEMC measures fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value. As of December 31, 2012 and 2011, the pension plan’s investments in equity and fixed income securities were all valued using Level 1 inputs based on the fair value as determined by quoted market price on a daily basis, except for $53.7 million that was valued using level 3 inputs as of December 31, 2012. This asset is an investment in a group annuity contract and the fair value is estimated to be the contract value of the group annuity contract. The pension plan can make withdrawals from the group annuity contract subject to certain provisions and restrictions. As there is a full guarantee of the contract value and the risk to the plan assets is minimized with such a guarantee the contract value is deemed to be an appropriate approximation of fair value. There were no similar assets as of December 31, 2011.

As discussed above, in 2011 the U.S. pension plan assets decreased to less than the accumulated benefit obligation. As of December 31, 2012 and 2011, the projected benefit obligation, accumulated benefit obligation and fair value of plan assets for pension plans with an accumulated benefit obligation in excess of plan assets were as follows:

	Pension Plans
	2012		2011
In millions
Projected benefit obligation, end of year	$	223.5	$	227.2
Accumulated benefit obligation, end of year	$	212.5	$	216.2
Fair value of plan assets, end of year	$	171.8	$	176.0

We estimate that the future benefits payable for the pension and other post-retirement plans are as follows:

	Pension Plans		Health Care and Other Plans
In millions
2013	$	18.4	$	1.4
2014	$	12.2	$	1.6
2015	$	12.0	$	1.5
2016	$	12.5	$	1.4
2017	$	12.3	$	1.4
2018-2022	$	61.4	$	6.5

Defined Contribution Plans

We sponsor a defined contribution plan under Section 401(k) of the Internal Revenue Code covering all U.S. salaried and hourly employees, and a defined contribution plan in Taiwan covering most salaried and hourly employees of our Taiwan subsidiary. Our costs included in our consolidated statement of operations totaled $9.1 million, $9.4 million and $6.1 million for 2012, 2011 and 2010, respectively.

Other Employee-Related Liabilities

Employees of our subsidiaries in Italy and Korea are covered by an end of service entitlement that provides payment upon termination of employment. Contributions to these plans are based on statutory requirements and are not actuarially determined. The accrued liability was $21.6 million at December 31, 2012 and $20.9 million at December 31, 2011, and is included in other long-term liabilities and accrued liabilities on our balance sheet. The accrued liability is based on the vested benefits to which the employee is entitled assuming employee termination at the measurement date.

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Inventories (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Inventory Disclosure [Abstract]
Raw materials and supplies	$ 89.1	$ 121.6
Goods and work in process	109.1	97.7
Inventory, Finished Goods, Net of Reserves	49.6	102.5
Inventories,Total	$ 247.8	$ 321.8

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Condensed Consolidating Financial Information Condensed Consolidting Statement of Comprehensive Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net income (loss)	$ (148.7)	$ (1,520.0)	$ 48.0
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	(186.5)	(1,574.0)	35.5
Net translation adjustment	(18.5)	(2.5)	16.2
Net unrealized (loss) gain on available-for-sale securities	(2.8)	(24.9)	(2.9)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(0.4)	7.1	(11.0)
Net unrecognized actuarial gain and prior service credit, net of tax	(11.9)	(16.0)	(0.6)
Other Comprehensive Income (Loss)	(33.6)	(36.3)	1.7
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(182.3)	(1,556.3)	49.7
Net Income (Loss) Attributable to Noncontrolling Interest	(1.9)	(16.0)	(13.6)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	(2.3)	(1.7)	(0.6)
MEMC, Inc. [Member]
Net income (loss)	(150.6)	(1,536.0)	34.4
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	(162.4)	(1,550.0)	38.3
Net translation adjustment	0	0	0
Net unrealized (loss) gain on available-for-sale securities	0	0	0
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	0	0	0
Net unrecognized actuarial gain and prior service credit, net of tax	(11.8)	(14.0)	3.9
Other Comprehensive Income (Loss)	(11.8)	(14.0)	3.9
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(162.4)	(1,550.0)	38.3
Net Income (Loss) Attributable to Noncontrolling Interest	0	0	0
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	0	0	0
Guarantor Subsidiaries [Member]
Net income (loss)	(142.3)	(1,564.3)	(42.9)
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	(143.0)	(1,564.8)	(42.6)
Net translation adjustment	0	0	0
Net unrealized (loss) gain on available-for-sale securities	0	0	0
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	0	0	0
Net unrecognized actuarial gain and prior service credit, net of tax	0	0	0
Other Comprehensive Income (Loss)	0	0	0
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(142.3)	(1,564.3)	(42.9)
Net Income (Loss) Attributable to Noncontrolling Interest	(0.7)	(0.5)	0.3
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	0	0	0
Non-Guarantor Subsidiaries [Member]
Net income (loss)	233.6	(669.8)	141.1
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	208.3	(709.3)	124.4
Net translation adjustment	(18.5)	(2.5)	16.2
Net unrealized (loss) gain on available-for-sale securities	(2.8)	(24.9)	(2.9)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(0.4)	7.1	(11.0)
Net unrecognized actuarial gain and prior service credit, net of tax	(0.1)	(2.0)	(4.5)
Other Comprehensive Income (Loss)	(21.8)	(22.3)	(2.2)
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	211.8	(692.1)	138.9
Net Income (Loss) Attributable to Noncontrolling Interest	(1.2)	(15.5)	(13.9)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	(2.3)	(1.7)	(0.6)
Consolidation, Eliminations [Member]
Net income (loss)	(89.4)	2,250.1	(84.6)
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	(89.4)	2,250.1	(84.6)
Net translation adjustment	0	0	0
Net unrealized (loss) gain on available-for-sale securities	0	0	0
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	0	0	0
Net unrecognized actuarial gain and prior service credit, net of tax	0	0	0
Other Comprehensive Income (Loss)	0	0	0
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(89.4)	2,250.1	(84.6)
Net Income (Loss) Attributable to Noncontrolling Interest	0	0	0
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Noncontrolling Interest	$ 0	$ 0	$ 0

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Consolidated Statements of Stockholders’ Equity (Parenthetical) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net unrecognized actuarial gain and prior service credit, tax	$ (10.5)	$ 10.5	$ 2.5

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Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 572.6	$ 585.8
Restricted cash	72.4	125.2
Accounts receivable, net	220.4	202.9
Inventories	247.8	321.8
Solar energy systems held for development and sale	133.8	373.0
Prepaid and other current assets	212.2	277.2
Total current assets	1,459.2	1,885.9
Investments	49.6	54.5
Property, plant and equipment, net:
Non-solar energy systems	1,213.1	1,253.7
Solar energy systems, including consolidated variable interest entities of $53.1 and $55.3 at December 31, 2012 and 2011, respectively	1,459.9	1,139.4
Deferred tax assets, net	0	44.8
Restricted cash	50.2	37.5
Other assets	355.4	316.6
Goodwill		0
Intangible assets, net	114.2	149.2
Total assets	4,701.6	4,881.6
Current liabilities:
Current portion of long-term debt and capital lease obligations	3.4	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations, including consolidated variable interest entities of $2.9 and $5.6 at December 31, 2012 and 2011, respectively	97.8	144.2
Accounts payable	477.0	694.6
Accrued liabilities	344.2	409.0
Contingent consideration related to acquisitions	23.1	71.6
Deferred revenue for solar energy systems	113.1	41.4
Customer and other deposits	77.2	72.4
Total current liabilities	1,135.8	1,436.9
Long-term debt and capital lease obligations, less current portion	758.7	567.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion, including consolidated variable interest entities of $69.2 and $57.0 at December 31, 2012 and 2011, respectively	1,508.4	1,211.2
Pension and post-employment liabilities	52.7	69.4
Customer and other deposits	184.5	276.8
Deferred revenue for solar energy systems	146.0	157.4
Non solar energy systems deferred revenue	29.2	51.2
Other liabilities	208.9	326.1
Total liabilities	4,024.2	4,096.7
Redeemable noncontrolling interest, Carrying Amount	11.3	0
Stockholders' equity:
Preferred stock, $.01 par value, 50.0 shares authorized, none issued or outstanding at December 31, 2012 or 2011	0	0
Common stock, $.01 par value, 300.0 shares authorized, 241.9 and 241.3 issued at December 31, 2012 and 2011, respectively	2.4	2.4
Additional paid-in capital	647.7	621.7
Retained earnings	425.3	577.5
Accumulated other comprehensive (loss) income	(39.8)	(3.9)
Treasury stock, 10.6 and 10.5 shares at December 31, 2012 and 2011, respectively	(460.3)	(459.8)
Total MEMC stockholders' equity	575.3	737.9
Stockholders' Equity Attributable to Noncontrolling Interest	90.8	47.0
Total stockholders' equity	666.1	784.9
Total liabilities and stockholders' equity	$ 4,701.6	$ 4,881.6

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Solar Energy Systems Held for Development and Sale

12 Months Ended

Dec. 31, 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:

	As of December 31,
	2012		2011
In millions
Under development	$	133.8	$	193.5
Systems held for sale	—		179.5
Total solar energy systems held for development and sale	$	133.8	$	373.0

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Reportable Segments (Schedule of Reportable Segments) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012		Dec. 31, 2011		Dec. 31, 2010
Segment Reporting Information [Line Items]
United States	$ 735.3		$ 447.5		$ 242.8
Foreign	1,794.6		2,268.0		1,996.4
Total	2,529.9		2,715.5		2,239.2
Operating (loss) income	57.2		(1,300.5)		21.1
Interest expense	135.3		77.2		29.0
Depreciation and amortization	246.9		227.1		164.8
Capital expenditures	485.9		1,050.6		632.1
Construction of solar energy systems	346.9		598.1		280.1
Revenues	1,794.6		2,268.0		1,996.4
Long-Lived Assets	2,673.0		2,393.1
Semiconductor Materials [Member]
Segment Reporting Information [Line Items]
Total	917.5		1,023.1		992.6
Operating (loss) income	(5.0)		(31.1)		68.2
Interest expense	(1.2)		(1.6)		3.2
Depreciation and amortization	121.6		124.2		108.8
Capital expenditures	75.1		144.6		150.4
Solar Energy [Member]
Segment Reporting Information [Line Items]
Total	1,612.4		1,692.4		1,246.6
Operating (loss) income	162.2		(1,144.0)		76.2
Interest expense	76.5		35.5		25.8
Depreciation and amortization	119.3		102.9		56.0
Capital expenditures	401.9	[1]	901.4	[1]	479.6	[1]
Construction of solar energy systems	346.9		598.1		280.1
Corporate and Other [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization	6.0		0		0
Capital expenditures	8.9		4.6		2.1
Corporate and Other [Member]
Segment Reporting Information [Line Items]
Operating (loss) income	(100.0)		(125.4)		(123.3)
Interest expense	60.0		43.3		0
UNITED STATES
Segment Reporting Information [Line Items]
Long-Lived Assets	1,510.0		975.2
CHINA
Segment Reporting Information [Line Items]
Revenues	82.8		598.8		415.8
JAPAN
Segment Reporting Information [Line Items]
Long-Lived Assets	120.9		165.3
KOREA
Segment Reporting Information [Line Items]
Revenues	198.8		237.1		176.9
TAIWAN
Segment Reporting Information [Line Items]
Revenues	408.4		530.0		549.4
Long-Lived Assets	231.7		255.4
ITALY
Segment Reporting Information [Line Items]
Revenues	234.2		375.6		385.3
Long-Lived Assets	215.9		427.5
CANADA
Segment Reporting Information [Line Items]
Revenues	248.6		104.9		4.4
SPAIN
Segment Reporting Information [Line Items]
Revenues	175.8		42.3		2.0
Other Foreign Countries [Member]
Segment Reporting Information [Line Items]
Revenues	446.0		379.3		462.6
Long-Lived Assets	$ 594.5		$ 569.7

[1] Consists primarily of construction of solar energy systems of $346.9 million, $598.1 million and $280.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

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Employee Related Liabilities (Projected Benefit Obligation And Future Benefits Payable) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Pension Plans [Member]
Defined Benefit Plan, Estimated Future Benefit Payments [Abstract]
2012	$ 18.4
2013	12.2
2014	12.0
2015	12.5
2016	12.3
2017-2021	61.4
Defined Benefit Plan, Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets [Abstract]
Projected benefit obligation, end of year	223.5	227.2
Accumulated benefit obligation, end of year	212.5	216.2
Fair value of plan assets, end of year	171.8	176.0
Health Care and Other Plans [Member]
Defined Benefit Plan, Estimated Future Benefit Payments [Abstract]
2012	1.4
2013	1.6
2014	1.5
2015	1.4
2016	1.4
2017-2021	$ 6.5

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Employee Related Liabilities (Summary Of Change In Benefit Obligation, Plan Assets, And Funded Status) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Change in plan assets:
Fair value of plan assets at end of year	$ 168.5	$ 171.6
Amounts recognized in statement of financial position:
Pension and post-employment liabilities, noncurrent	(52.7)	(69.4)
Pension and Other Postretirement Benefit Plans, Accumulated Other Comprehensive Income (Loss), before Tax [Abstract]
Net amount recognized	10.5	(10.5)	(2.5)
Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Settlements, Plan Assets	(18.5)	0
Change in benefit obligation:
Benefit obligation at beginning of year	227.2	213.3
Service cost	1.1	2.9	2.9
Interest cost	7.8	9.4	9.6
Plan participants’ contributions	0	0
Plan amendments	0	0
Actuarial loss (gain)	17.8	19.0
Gross benefits paid	(8.7)	(14.9)
Settlements and curtailments	(21.0)	(2.1)
Currency exchange (gain) loss	(0.7)	(0.4)
Benefit obligation at end of year	223.5	227.2	213.3
Change in plan assets:
Fair value of plan assets at beginning of year	176.0	192.2
Actual (loss) gain on plan assets	22.3	(2.4)
Employer contributions	0.6	1.5
Plan participants’ contributions	0	0
Gross benefits paid	(8.7)	(14.9)
Currency exchange (loss) gain	0.1	(0.4)
Fair value of plan assets at end of year	171.8	176.0	192.2
Net amount recognized	(51.7)	(51.2)
Amounts recognized in statement of financial position:
Other assets, noncurrent	0	0
Accrued liabilities, current	(0.6)	(0.7)
Pension and post-employment liabilities, noncurrent	(51.1)	(50.5)
Net amount recognized	(51.7)	(51.2)
Pension and Other Postretirement Benefit Plans, Accumulated Other Comprehensive Income (Loss), before Tax [Abstract]
Net actuarial loss (gain)	86.8	88.2
Prior service (credit) cost	0	0
Net amount recognized	86.8	88.2
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year [Abstract]
Actuarial loss (gain)	2.6
Prior service (credit) cost	0
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year	2.6
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Discount rate	3.14%	3.65%
Rate of compensation increase	0.00%	3.62%
Health Care and Other Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Settlements, Plan Assets	0	0
Change in benefit obligation:
Benefit obligation at beginning of year	20.1	23.0
Service cost	0	0	0
Interest cost	0.8	1.1	1.4
Plan participants’ contributions	0.5	0.8
Plan amendments	0	(3.9)
Actuarial loss (gain)	2.3	1.1
Gross benefits paid	(2.2)	(2.0)
Settlements and curtailments	0	0
Currency exchange (gain) loss	0	0
Benefit obligation at end of year	21.5	20.1	23.0
Change in plan assets:
Fair value of plan assets at beginning of year	0	0
Actual (loss) gain on plan assets	0	0
Employer contributions	1.7	1.2
Plan participants’ contributions	0.5	0.8
Gross benefits paid	(2.2)	(2.0)
Currency exchange (loss) gain	0	0
Fair value of plan assets at end of year	0	0	0
Net amount recognized	(21.5)	(20.1)
Amounts recognized in statement of financial position:
Other assets, noncurrent	0	0
Accrued liabilities, current	(1.4)	(1.2)
Pension and post-employment liabilities, noncurrent	(20.1)	(18.9)
Net amount recognized	(21.5)	(20.1)
Pension and Other Postretirement Benefit Plans, Accumulated Other Comprehensive Income (Loss), before Tax [Abstract]
Net actuarial loss (gain)	(0.3)	(3.1)
Prior service (credit) cost	(12.1)	(12.8)
Net amount recognized	(12.4)	(15.9)
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year [Abstract]
Actuarial loss (gain)	0
Prior service (credit) cost	(0.7)
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year	$ (0.7)
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Discount rate	3.37%	3.95%
Rate of compensation increase	3.75%	3.75%

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Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2012	Feb. 25, 2013	Jun. 30, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	MEMC ELECTRONIC MATERIALS INC
Entity Central Index Key	0000945436
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-K
Trading Symbol	wfr
Document Period End Date	Dec. 31, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		231,325,319
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 500,296,911

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Property, Plant and Equipment (Including Consolidated VIEs)

12 Months Ended

Dec. 31, 2012

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT (INCLUDING CONSOLIDATED VIEs)

PROPERTY, PLANT AND EQUIPMENT (INCLUDING CONSOLIDATED VIEs)

Property, plant and equipment consists of the following:

	As of December 31,
	2012			2011
In millions
Land	$	6.1		$	6.5
Software	31.1			31.2
Buildings and improvements	320.5			404.7
Machinery and equipment	1,605.5			1,470.6
Solar energy systems	1,306.5			896.2
	3,269.7			2,809.2
Less accumulated depreciation	(964.1		)	(851.8		)
	2,305.6			1,957.4
Construction in progress – non solar energy systems	141.4			155.5
Construction in progress – solar energy systems	226.0			280.2
Total property, plant and equipment, net	$	2,673.0		$	2,393.1

We recorded asset impairment charges of $20.0 million for the year ended December 31, 2012, primarily related to solar wafer machinery and equipment. These charges are reflected in the long-lived asset impairment charges in our consolidated statement of operations. We obtained title to a chlorosilanes plant as part of the settlement with Evonik, which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

Due to the downturn in solar market conditions, we performed an asset impairment analysis of the polysilicon production assets at our shuttered Merano, Italy facility, as well as solar wafering assets at our Portland, Oregon, Kuching, Malaysia and St. Peters, Missouri facilities in the fourth quarter of 2011. As a result of this analysis, we recognized asset impairment charges of $354.7 million during the year ended December 31, 2011, which were recorded in the long-lived asset impairment charges in our consolidated statement of operations. No similar charges were recorded during the year ended December 31, 2010.

The polysilicon manufacturing assets at our shuttered Merano, Italy facility were impaired at December 31, 2011 and written down to their net realizable salvage value, which was based primarily on an appraisal. For our solar wafering assets, we estimated the fair value of the asset group using discounted expected cash flows and recorded an impairment charge during 2011 because the net carrying value of the asset group exceeded its fair value. The value of these assets deteriorated because of the significant market price declines and we ceased or scaled back manufacturing operations due to changes in future service potential. We developed our expected cash flows based on assumptions that were consistent with our then current and forecast operating plans, which are considered Level 3 inputs in the fair value hierarchy. Cash flows cover a time period that coincides with the estimated remaining useful life of the primary assets and a probability factor was assigned to each cash flow scenario to derive the expected present value based on a risk-free discount rate.

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Debt and Capital Lease Obligations (Minimum Lease Payments) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments [Abstract]
2013	$ 9.8
2014	6.6
2015	5.3
2016	5.7
2017	5.8
Thereafter	90.9
Total minimum lease payments	124.1
Less amounts representing interest	(30.8)
Present value of minimum lease payments	93.3
Less current portion of obligations under capital leases	(7.5)
Noncurrent portion of obligations under capital leases	85.8
Minimum Lease Payments, Sale Leaseback Transactions	890.2
Minimum Lease Payments, Sale Leaseback Transactions [Abstract]
2013	60.5
2014	48.5
2015	46.4
2016	42.9
2017	$ 40.9

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Employee Related Liabilities (Net Periodic Benefit Cost) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Pension Plans [Member]
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract]
Service cost	$ 1.1	$ 2.9	$ 2.9
Interest cost	7.8	9.4	9.6
Expected return on plan assets	(13.8)	(15.4)	(14.3)
Amortization of prior service cost	0	0	0
Net actuarial loss (gain)	4.1	7.9	8.5
Settlement and curtailment charges	6.7	0	0
Net periodic benefit cost (income)	5.9	4.8	6.7
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract]
Discount rate	3.65%	4.58%	5.18%
Expected return on plan assets	8.34%	8.36%	8.38%
Rate of compensation increase	3.62%	3.63%	3.73%
Health Care and Other Plans [Member]
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract]
Service cost	0	0	0
Interest cost	0.8	1.1	1.4
Expected return on plan assets	0	0	0
Amortization of prior service cost	(0.7)	(0.5)	(0.5)
Net actuarial loss (gain)	(0.5)	(1.5)	(1.6)
Settlement and curtailment charges	0	0	0
Net periodic benefit cost (income)	$ (0.4)	$ (0.9)	$ (0.7)
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract]
Discount rate	3.93%	5.09%	5.65%
Rate of compensation increase	3.75%	3.75%	3.75%
Current medical cost trend rate	8.00%	8.00%	8.00%
Ultimate medical cost trend rate	5.00%	5.00%	5.75%
Year the rate reaches ultimate trend rate	2018	2017	2016

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Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Per Share data, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Property, Plant and Equipment - Solar energy systems, consolidated variable interest entities	$ 53.1	$ 55.3
Short-term solar energy system financing, current portion of solar energy system financing and capital lease obligations, consolidated variable interest entities	2.9	5.6
Long-term solar energy system financing and capital lease obligations, consolidated variable interest entities	$ 69.2	$ 57.0
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	50.0	50.0
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	300.0	300.0
Common stock, shares issued	241.9	241.3
Treasury stock, shares	10.6	10.5

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Restructuring and Impairment Charges

12 Months Ended

Dec. 31, 2012

Restructuring and Related Activities [Abstract]

RESTRUCTURING AND IMPAIRMENT CHARGES

RESTRUCTURING, IMPAIRMENT AND OTHER CHARGES

2011 Global Plan

During the second half of 2011, the semiconductor and solar industries experienced downturns, and the downturn in the solar industry was more dramatic. In December 2011, in order to better align our business to current and expected market conditions in the semiconductor and solar markets, as well as to improve the company's overall cost competitiveness and cash flows across all segments, we committed to a series of actions to reduce the company's global workforce, right size production capacity and accelerate operating cost reductions in 2012 and beyond (the “2011 Global Plan”).  These actions included:

• Reducing total workforce by approximately 1,400 persons worldwide, representing approximately 20% of the company's employees; 

• Shuttering the company's Merano, Italy polysilicon facility as of December 31, 2011;

• Reducing production capacity at the company's Portland, Oregon crystal facility and slowing the ramp of the Kuching, Malaysia wafering facility; and

• Consolidating our solar wafering and solar energy system operations into a single Solar Energy business unit, effective January 1, 2012.

In addition, based on the market capitalization of MEMC compared to book value and the adverse market conditions, we incurred charges associated with restructuring, impairment of long-lived assets, impairments of goodwill and certain investments, and write-downs of inventory and the realizability of deferred tax assets. The following is a summary of the charges recorded during the three months ended December 31, 2011:

In millions	Segment
Type of Charge	Semiconductor Materials		Solar Energy		Corporate		Total		Statement of Operations Classification
Restructuring	$	35.6	$	303.0	$	0.9	$	339.5	Restructuring
Long-lived asset impairment (See Note 9)	7.4		358.0		—		365.4		Long-lived asset impairment
Goodwill impairment (See Note 10)	—		384.1		—		384.1		Goodwill impairment
Investment/JV impairment (See Note 6)	—		78.9		—		78.9		Other, net and equity in loss of joint ventures
Inventory adjustments and other (See Note 7)	14.2		82.5		—		96.7		Cost of goods sold

In the fourth quarter of 2011, restructuring charges consisted of $62.1 million of severance and other one-time benefits for employees terminated under the 2011 Global Plan, $226.4 million of estimated liabilities accrued as a result of us canceling or not being able to fulfill the entire purchase obligation for certain supplier contracts, and $51.0 million of other related charges. Total cash payments made under the 2011 Global Plan during the year ended December 31, 2011 were $1.8 million. See table below for cash payments made during the year ended December 31, 2012. For additional discussion on the charges associated with the impairment of long-lived assets, impairments of goodwill and certain investments, and write-downs of inventory and the realizability of deferred tax assets, see the respective footnotes noted in the above table.

In addition, during June 2011, we committed to actions to reduce overall manufacturing costs across our global sites, as well as to realign certain general and administrative expenses due to industry and customer specific developments. These actions included relocation of certain operations and reductions in headcount. During the year ended December 31, 2011, we recorded restructuring charges of $6.8 million for severance and other related employee benefits associated with these actions. Cash payments of $9.9 million were made during 2011 that were also related to these actions.

Details of the 2012 expenses, cash payments and expected costs incurred related to the 2011 Global Plan are set out in the following table:

														As of December 31, 2012
In millions	Accrued January 1, 2012		Year-to-date Restructuring Charges (Reversals)			Cash Payments			Currency			Accrued December 31, 2012		Cumulative Costs Incurred		Total Costs Expected to be Incurred
2011 Global Plan
Severance and Employee Benefits	$	60.2	$	—		$	(27.8	)	$	(0.7	)	$	31.7	$	63.2	$	63.2
Contract Termination	260.0		(93.4		)	(34.3		)	2.2			134.5		164.6		164.6
Other	51.1		(2.1		)	(11.9		)	1.2			38.3		49.7		49.7
Total	$	371.3	$	(95.5	)	$	(74.0	)	$	2.7		$	204.5	$	277.5	$	277.5

On September 4, 2012, we executed two settlement agreements with Evonik Industries AG and Evonik Degussa SpA ("Evonik"), one of our suppliers, to settle disputes arising from our early termination of two take-or-pay supply agreements. One of the original supply agreements also included a provision for the construction and operation of a chlorosilanes plant located on our existing Merano, Italy site for our benefit. Pursuant to the settlement, we will pay Evonik a total of 70.0 million euro, of which 10.0 million euro was paid in the third quarter of 2012 and 15.0 million euro was paid in the fourth quarter of 2012. The balance will be paid in various installments over the next three quarters. The settlement also required our forfeiture of a $10.2 million deposit with Evonik. As a result of this settlement, a favorable adjustment to our 2011 Global Plan accrual was made in the third quarter of 2012 resulting in $69.2 million of income within restructuring and impairment on the consolidated statement of operations. Additionally, on December 30, 2012 as part of the settlement with Evonik, we obtained title to the related chlorosilanes plant, which resulted in $31.7 million of income on the consolidated statement of operations in the fourth quarter of 2012.

2009 Restructuring Plan

In order to better align manufacturing capabilities to projected demand, MEMC committed to workforce reductions during the first and second quarters of 2009 (the “2009 Global Plan”) related to the Semiconductor Materials segment. In September 2009, MEMC committed to actions to reduce manufacturing costs in the Semiconductor Materials segment by shifting manufacturing from our St. Peters, Missouri and Sherman, Texas facilities to other locations which are closer to a number of MEMC’s customers in the Asia Pacific region (the “2009 U.S. Plan”). MEMC has provided and paid severance benefits to those terminated under the 2009 Global Plan and will provide severance benefits to those employees who have been or will be terminated under the 2009 U.S. Plan. The 2009 Global Plan was completed by June 30, 2009. We expect the 2009 U.S. Plan to be completed in 2013.

Details of 2012 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2012		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2012		As of December 31, 2012
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	12.6	$	(2.5	)	$	(7.4	)	$	2.7	$	15.5	$	15.5
Asset move costs	—		—			—			—		4.9		5.2
Contract termination	2.9		—			(2.9		)	—		2.9		2.9
Infrastructure costs	—		4.3			(4.3		)	—		4.3		4.3
Total	$	15.5	$	1.8		$	(14.6	)	$	2.7	$	27.6	$	27.9

Details of 2011 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2011		Year-to-Date Restructuring Charges (Reversals)			Cash Payments			Accrued December 31, 2011		As of December 31, 2011
											Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	16.2	$	(0.2	)	$	(3.4	)	$	12.6	$	18.0	$	18.8
Asset move costs	—		1.7			(1.7		)	—		4.9		20.3
Contract termination	—		2.9			—			2.9		2.9		2.9
Infrastructure costs	—		—			—			—		—		4.0
Total	$	16.2	$	4.4		$	(5.1	)	$	15.5	$	25.8	$	46.0

Details of 2010 expenses related to the 2009 U.S. and Global Plans are set out in the following table:

	Accrued January 1, 2010		Year-to-Date Restructuring Charges		Cash Payments			Accrued December 31, 2010		As of December 31, 2010
										Cumulative Costs Incurred		Total Costs Expected to be Incurred
In millions
2009 U.S. and Global Plans
Severance and other employee benefits	$	15.2	$	2.1	$	(1.1	)	$	16.2	$	18.2	$	21.0
Asset move costs	—		3.2		(3.2		)	—		3.2		20.3
Contract termination	—		—		—			—		—		3.0
Infrastructure costs	—		—		—			—		—		4.0
Total	$	15.2	$	5.3	$	(4.3	)	$	16.2	$	21.4	$	48.3

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2012

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

In preparing our financial statements, we use estimates and assumptions that may affect reported amounts and disclosures. Estimates are used when accounting for investments, depreciation, amortization, leases, accrued liabilities including restructuring, warranties, employee benefits, derivatives, stock-based compensation, income taxes, solar energy system installation and related costs, percentage-of-completion on long-term construction contracts, the fair value of assets and liabilities recorded in connection with business combinations, and goodwill and asset recoverability, including allowances, among others. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. To the extent there are material differences between the estimates and actual results, our future results of operations would be affected.

Reclassifications

Certain amounts in prior fiscal years have been reclassified to conform with the presentation adopted in the current fiscal year.

Principles of Consolidation

Our consolidated financial statements include the accounts of MEMC Electronic Materials, Inc. and our wholly and majority-owned subsidiaries as well as variable interest entities ("VIEs") for which we are the primary beneficiary. We record noncontrolling interests for non-wholly owned consolidated subsidiaries. As of December 31, 2012 and December 31, 2011 our total noncontrolling interest on the consolidated balance sheet was $90.8 million and $47.0 million, respectively. In 2012, SunEdison entered into a joint venture related to the construction and operation of solar energy systems in South Africa, where there is a partial equity holding requirement. As of December 31, 2012, approximately $34.0 million of equity investments had been received by joint venture partners for the development of the solar energy systems. All significant intercompany balances and transactions among our consolidated subsidiaries have been eliminated. We have also eliminated our pro-rata share of sales, costs of goods sold and profits related to sales to equity method investees.

Variable Interest Entities

SunEdison’s business can involve the formation of special purpose vehicles (referred to as “project companies”) to own the project assets and execute agreements for the construction and maintenance of the assets, as well as power purchase agreements or feed in tariff agreements with a buyer who will purchase the electricity generated from the solar energy system once it is operating. SunEdison may establish joint ventures with non-related parties to share in the risks and rewards associated with solar energy system development, which are facilitated through equity ownership of a project company. The project companies engage SunEdison to engineer, procure and construct the solar energy system and may separately contract with SunEdison to perform predefined operational and maintenance services post construction. We evaluate the terms of those contracts as well as the joint venture agreements to determine if the entity is a VIE, as well as if SunEdison is the primary beneficiary.

VIEs are primarily entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions; (b) obligation to absorb expected losses; or (c) right to receive expected residual returns. VIEs must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. A VIE should have only one primary beneficiary, but may not have a primary beneficiary if no party meets the criteria described above.

To determine a VIE's primary beneficiary, an enterprise must perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. Therefore, an enterprise must identify the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, and must therefore consolidate the entity, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. If that evaluation is inconclusive as to which party absorbs a majority of the entity’s expected losses or residual returns, a quantitative analysis is performed to determine the primary beneficiary.

For our consolidated VIEs, we have presented on our consolidated balance sheets, to the extent material, the assets of our consolidated VIEs that can only be used to settle specific obligations of the consolidated VIE, and the liabilities of our consolidated VIEs for which creditors do not have recourse to our general assets outside of the VIE.

We are the primary beneficiary of five VIEs in solar energy projects that we consolidated as of December 31, 2012, three of which existed and were consolidated by the Company as of December 31, 2011. During the year ended December 31, 2012, one solar energy system project company that was consolidated as of December 31, 2011 was sold and deconsolidated.

Cash and Cash Equivalents

Cash equivalents include highly liquid commercial paper, time deposits and money market funds with original maturity periods of three months or less when purchased. The majority of our cash and cash equivalents are held outside the U.S. Total cash and cash equivalents maintained by foreign subsidiaries whose functional currency is not the U.S. dollar were $171.5 million and $64.2 million as of December 31, 2012 and 2011, respectively. Cash and cash equivalents consist of the following:

	As of December 31,
	2012		2011
Dollars in millions
Cash	$	514.5	$	417.0
Cash Equivalents:
Commercial paper	10.0		10.0
Money market funds	48.1		158.8
	$	572.6	$	585.8

Restricted Cash

Restricted cash consists of cash on deposit in financial institutions that is restricted from use in operations. In certain transactions, we have agreed to issue a letter of credit or provide security deposits regarding the performance or removal of a solar energy system. Incentive application fees are deposited with local governmental jurisdictions which are held until the construction of the applicable solar energy system is completed. In addition, cash received during the lease term of a sale leaseback transaction may be subject to a security and disbursement agreement which generally establishes a reserve requirement for scheduled lease payments under our master lease agreements as discussed below under Revenue Recognition, Solar Energy System Sales, Sale with a leaseback, for each leaseback arrangement, as well as certain additional reserve requirements that may be temporarily required in an accrual account. All of the reserve requirements for scheduled lease payments for all projects under each master lease agreement must be satisfied before cash is disbursed under the master lease agreements.

Allowance for Doubtful Accounts

We establish an allowance for doubtful accounts to adjust our receivables to amounts considered to be ultimately collectible. Our allowance is based on a variety of factors, including the length of time receivables are past due, significant one-time events, the financial health of our customers and historical experience. The balance of our allowance for doubtful accounts was $4.4 million and $4.9 million as of December 31, 2012 and 2011, respectively. Our provision for bad debts was a $0.3 millionbenefit, due to the recovery of previously written off accounts, $1.4 millionexpense and $1.4 millionbenefit for the years ended December 31, 2012, 2011 and 2010, respectively. There were $0.2 million, $4.3 million and $0.7 million of write-offs for bad debts for the years ended December 31, 2012, 2011, and 2010 respectively.

Inventories

Inventories consists of raw materials, labor and manufacturing overhead and are valued at the lower of cost or market. Fixed overheads are allocated to the costs of conversion based on the normal capacity of our production facilities. Unallocated overheads during periods of abnormally low production levels are recognized as cost of goods sold in the period in which they are incurred. Raw materials and supplies are generally stated at weighted-average cost and goods and work-in-process and finished goods inventories are stated at standard cost as adjusted for variances, which approximates weighted-average actual cost. The valuation of inventory requires us to estimate excess and slow moving inventory. The determination of the value of excess and slow moving inventory is based upon assumptions of future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

Inventories also includes raw materials (such as solar panels) and supplies used to construct future solar energy systems developed for sale to third parties, which have not been designated to a specific project as of the balance sheet date. When the inventory is designated for use to build a specific project, the inventory will be reclassified to either solar energy systems held for development and sale or to property, plant and equipment - construction in progress, which is determined based on our intended use of the system. The cost of raw materials for solar energy systems is based on the first-in, first-out (FIFO) method.

Solar Energy Systems Held for Development and Sale

Solar energy systems are classified as either held for development and sale or as property, plant and equipment based on our intended use of the system once constructed and provided that certain criteria to be classified as held for sale are met. The classification of the system affects the future accounting and presentation in the consolidated financial statements, including the consolidated statement of operations and statement of cash flows.  Transactions related to the construction and sale of solar energy systems classified as held for development and sale are classified as operating activities in the consolidated statement of cash flows and within gross profit in the statement of operations when sold.  Solar energy systems that are classified as property, plant and equipment generally relate to our sale leaseback transactions.  The costs to construct solar energy systems classified as property, plant and equipment are classified in the investing activities of the consolidated statement of cash flows. The proceeds received for the sale and subsequent leaseback are classified as cash flows from financing activities within the consolidated statement of cash flows.

Solar energy systems held for development include solar energy system project related assets for projects that have commenced and are actively marketed and intended to be sold. Development costs include capitalizable costs for items such as permits, acquired land, deposits and work-in-process, among others. Work-in-process includes materials, labor and other capitalizable costs incurred to construct solar energy systems. 

Solar energy systems held for sale are completed solar energy systems that have been interconnected. Solar energy systems held for sale are available for immediate sale in their present conditions subject only to terms that are usual and customary for sales of these types of assets. In addition, we are actively marketing the systems to potential third party buyers, and it is probable that the system will be sold within one year of its placed in service date. Solar energy systems held for sale also include systems under contract with a buyer that are accounted for using the deposit method, whereby cash proceeds received from the buyer are held as deposits until a sale can be recognized.

We do not depreciate our solar energy systems while classified as held for sale. Any energy or incentive revenues are recorded to other income, as such revenues are incidental to our intended use of the system (direct sale to a third party buyer). If facts and circumstances change such that it is no longer probable that the system will be sold within one year of the system's completion date, the system will be reclassified to property, plant and equipment, and we will record depreciation expense in the amount that would have otherwise been recorded during the period the system was classified as held for sale.

Investments

Cost and Equity Method Investments

Cost method investments are initially recorded and subsequently carried at their historical cost and income is recorded to the extent there are dividends. We use the equity method of accounting for our equity investments where we hold more than 20 percent of the outstanding stock of the investee or where we have the ability to significantly influence the operations or financial decisions of the investee. We initially record the investment at cost and adjust the carrying amount each period to recognize our share of the earnings or losses of the investee based on our ownership percentage. We review our equity and cost method investments periodically for indicators of impairment.

Available-for-Sale Investments

Investments designated as available-for-sale are reported at fair value with unrealized gains and losses, net of tax, recorded in accumulated other comprehensive (loss) income. Purchases and sales of available-for-sale investments are included in investing activities in the consolidated statement of cash flows.

Investments are evaluated at each period end date for impairment, including classification as temporary or other-than-temporary. Unrealized losses are recorded to other income and expense when a decline in fair value is determined to be other-than-temporary. We review several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the nature of the investment; (ii) the cause and duration of the impairment; (iii) the extent to which fair value is less than cost; (iv) the financial condition and near term prospects of the issuer; and (v) our ability to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. Realized gains and losses are accounted for on the specific identification method. We determine the fair value of our debt securities using quoted prices from active and inactive markets, traded prices for similar assets, or fair value measurements based on a pricing model. We also review our ability and intent to liquidate our investments within the next 12 month operating cycle to determine the appropriate short or long-term classification. Our ability to liquidate is determined based on a review of current and short-term credit and capital market conditions and the financial condition and near term prospects of the issuer.

Property, Plant and Equipment

We record property, plant and equipment at cost and depreciate it evenly over the assets’ estimated useful lives as follows:

	Years
Software	3-6
Buildings and improvements	4-60
Machinery and equipment	1-25
Solar energy systems	23-30

Expenditures for repairs and maintenance are charged to expense as incurred. Additions and betterments are capitalized. The cost and related accumulated depreciation on property, plant and equipment sold or otherwise disposed of are removed from the capital accounts and any gain or loss is reported in current-year operations.

We often construct solar energy systems for which we do not have a fixed-price construction contract and, in certain instances, we may construct a system and retain ownership of the system or perform a sale-leaseback. For these projects, we earn revenues associated with the energy generated by the solar energy system, capitalize the cost of construction to solar energy system property, plant and equipment and depreciate the system over its estimated useful life. For solar energy systems under construction for which we intend to retain ownership and finance the system, we recognize all costs incurred as solar system construction in progress.

We may sell a solar energy system and simultaneously lease back the solar energy system. Property, plant and equipment accounted for as capital leases (primarily solar energy systems) are depreciated over the life of the lease. Solar energy systems that have not reached consummation of a sale under real estate accounting and have been leased back are recorded at the lower of the original cost to construct the system or its fair value and depreciated over the equipment's estimated useful life. For those sale leasebacks accounted for as capital leases, the gain, if any, on the sale leaseback transaction is deferred and recorded as a contra-asset that reduces the cost of the solar energy system, thereby reducing depreciation expense over the life of the asset. Generally, as a result of various tax attributes that accrue to the benefit of the lessor/tax owner, solar energy systems accounted for as capital leases are recorded at the net present value of the future minimum lease payments because this amount is lower than the cost and fair market value of the solar energy system at the lease inception date.

Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the remaining lease term, including renewal periods considered reasonably assured of execution.

When we are entitled to incentive tax credits for property, plant and equipment, we reduce the asset carrying value by the amount of the credit, which reduces future depreciation.

Consolidated depreciation expense for the years ended December 31, 2012, 2011 and 2010 was $200.6 million, $217.7 million and $158.9 million, respectively, and includes depreciation expense for capital leases of $4.3 million, $9.7 million and $4.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The cost of constructing facilities, equipment and solar energy systems includes interest costs incurred during the asset's construction period. Capitalized interest totaled $19.9 million, $18.1 million and $5.1 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Asset retirement obligations are recognized at fair value in the period in which they are incurred and the carrying amount of the related long-lived asset is correspondingly increased. Over time, the liability is accreted to its expected future value. The corresponding asset capitalized at inception is depreciated over the useful life of the asset. We operate under solar power services agreements with some customers that include a requirement for the removal of the solar energy systems at the end of the term of the agreement. In addition, we could have certain legal obligations for asset retirements related to disposing of materials in the event of closure, abandonment or sale of certain of our manufacturing facilities. We recognize a liability in the period in which we have determined the time frame that the asset will no longer operate and information is available to reasonably estimate the liability’s fair value.

Impairment of Property, Plant and Equipment

We periodically assess the impairment of long-lived assets/asset groups when conditions indicate a possible loss. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using: (i) quoted market prices or (ii) discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. We recorded asset impairment charges in 2012 and 2011; no similar charges were recorded in 2010. See Note 9 for additional discussion on the impairment charges on long-lived assets.

Goodwill and Intangible Assets

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired and liabilities assumed. Goodwill and intangible assets determined to have indefinite lives are not amortized, but rather are subject to an impairment test annually, on December 1, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Our indefinite-lived intangible assets include power plant development arrangements acquired in a business combination which relate to anticipated future economic benefits associated with our customer backlog relationships. These intangible assets will be allocated to fixed assets as the construction of the related solar energy systems stemming from the existing backlog is completed.

The goodwill impairment test involves a two-step approach. Under the first step, we determine the fair value of each reporting unit to which goodwill has been assigned. We compare the fair value of the reporting unit to its carrying value, including goodwill. If the estimated fair value exceeds the carrying value, no impairment loss is recognized. If the carrying value exceeds the fair value, goodwill is considered potentially impaired and the second step is completed in order to measure the impairment loss. Under the second step, if applicable, we calculate the implied fair value of goodwill by deducting the fair value of all tangible and intangible net assets, including any unrecognized intangible assets, of the reporting unit from the fair value of the reporting unit as determined in the first step.

We then compare the implied fair value of goodwill to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, we recognize an impairment loss equal to the difference. See Note 10 for discussion on the goodwill impairment charges recorded during the year ended December 31, 2011. As of December 31, 2012, we had no remaining goodwill.

Intangible assets that have determinable estimated lives are amortized over those estimated lives. The straight-line method of amortization is used because it best reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up. The amounts and useful lives assigned to intangible assets acquired impact the amount and timing of future amortization. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows or some other fair value measure. If this comparison indicates that there is impairment, the impaired asset is written down to fair value, which is typically calculated using discounted expected future cash flows utilizing an appropriate discount rate. Impairment is based on the excess of the carrying amount over the fair value of those assets. During 2012 and 2011 we recorded intangible asset impairments; see Note 10. No similar charges were recorded in 2010.

The estimated useful lives of our intangible assets subject to amortization are as follows:

	Years
Favorable energy credits	4-18
Customer sales backlog and relationships	1-6
Trade name	15
Developed technology	5

Operating Leases

We enter into lease agreements for a variety of business purposes, including office and manufacturing space, office and manufacturing equipment and computer equipment. A portion of these are noncancellable operating leases.

Capital Leases

We are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. For those transactions which do not fall under real estate accounting, we record a lease liability and the solar energy system is retained on our balance sheet. The excess of the cash proceeds of the sale leaseback over the costs to construct the solar energy system is retained by us and used to fund current operations and new solar energy projects. See further discussion in Revenue Recognition below.

Customer and Other Deposits

We have executed long-term solar wafer supply agreements, including amendments, with multiple customers which required the customers to provide security deposits. The terms of these deposits vary, but are generally required to be applied against a portion of current sales on credit or refunded to customers over the term of the applicable agreement. We also receive short-term deposits from customers, deposits from suppliers and, in 2012 and 2011, received deposits in connection with a supply and license agreement with one of our joint ventures. See Note 6.

Revenue Recognition

Wafer and Other Product Sales

Revenue is recognized for wafer and other product sales when title transfers, the risks and rewards of ownership have been transferred to the customer, the fee is fixed or determinable and collection of the related receivable is reasonably assured, which is generally at the time of shipment for non-consignment orders. In the case of consignment orders, title passes when the customer pulls the product from the assigned storage facility or storage area or, if the customer does not pull the product within a contractually stated period of time (generally 60–90 days), at the end of that period, or when the customer otherwise agrees to take title to the product. Our wafers are generally made to customer specifications, and we conduct rigorous quality control and testing procedures to ensure that the finished wafers meet the customer’s specifications before the product is shipped. We consider international shipping term definitions in our determination of when title passes. We defer revenue for multiple element arrangements based on an average fair value per unit for the total arrangement when we receive cash in excess of fair value. We also defer revenue when pricing is not fixed or determinable or other revenue recognition criteria is not met.

In connection with certain of our long-term solar wafer supply agreements, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements.

Solar Energy System Sales

Solar energy system sales involving real estate

We recognize revenue for solar energy system sales with the concurrent sale or the concurrent lease of the underlying land, whether explicit or implicit in the transaction, in accordance with ASC 360-20, Real Estate Sales. For these transactions, we evaluate the solar energy system to determine whether the equipment is integral equipment to the real estate; therefore, the entire transaction is in substance the sale of real estate and subject to revenue recognition under ASC 360-20. A solar energy system is determined to be integral equipment when the cost to remove the equipment from its existing location, ship and reinstall at a new site, including any diminution in fair value, exceeds ten percent of the fair value of the equipment at the time of original installation. For those transactions subject to ASC 360-20, we recognize revenue and profit using the full accrual method once the sale is consummated, the buyer's initial and continuing investments are adequate to demonstrate its commitment to pay, our receivable is not subject to any future subordination, and we have transferred the usual risk and rewards of ownership to the buyer. If these criteria are met and we execute a sales agreement prior to the delivery of the solar energy system and have an original construction period of three months or longer, we recognize revenue and profit under the percentage of completion method of accounting applicable to real estate sales when we can reasonably estimate progress towards completion. During 2012 and 2011, we recognized $97.8 million and $54.3 million, respectively, of revenue using the percentage of completion method. Prior to 2011, we did not have sales that qualified for using the percentage of completion method.

If the criteria for recognition under the full accrual method are met except that the buyer's initial and continuing investment is less than the level determined to be adequate, then we will recognize revenue using the installment method. Under the installment method, we record revenue up to our costs incurred and apportion each cash receipt from the buyer between cost recovered and profit in the same ratio as total cost and total profit bear to the sales value. During 2012 and 2011, we recognized revenue of $22.7 million and $28.5 million, respectively, using the installment method. Prior to 2011, we did not have sales that qualified for using the installment method.

If we retain some continuing involvement with the solar energy system and do not transfer substantially all of the risks and rewards of ownership, profit shall be recognized by a method determined by the nature and extent of our continuing involvement, provided the other criteria for the full accrual method are met. In certain cases, we may provide our customers guarantees of system performance or uptime for a limited period of time and our exposure to loss is contractually limited based on the terms of the applicable agreement. In accordance with real estate sales accounting guidance, the profit recognized is reduced by our maximum exposure to loss (and not necessarily our most probable exposure), until such time that the exposure no longer exists.

Other forms of continuing involvement that do not transfer substantially all of the risks and rewards of ownership preclude revenue recognition under real estate accounting and require us to account for any cash payments using either the deposit or financing method. Such forms of continuing involvement may include contract default or breach remedies that provide SunEdison with the option or obligation to repurchase the solar energy system. Under the deposit method, cash payments received from customers are reported as deferred revenue for solar energy systems on the consolidated balance sheet, and under the financing method, cash payments received from customers are considered debt and reported as solar energy financing and capital lease obligations on the consolidated balance sheet.

Solar energy system sales not involving real estate

We recognize revenue for solar energy system sales without the concurrent sale or the concurrent lease of the underlying land at the time a sales arrangement with a third party is executed, delivery has occurred and we have determined that the sales price is fixed or determinable and collectible. For transactions that involve a construction period of three months or longer, we recognize the revenue in accordance with ASC 605-35, Construction-Type and Production-Type Contracts, using the percentage of completion method, measured by actual costs incurred for work completed to total estimated costs at completion for each transaction. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and travel costs. Marketing and administration costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are recognized in full during the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and revenue and are recognized in the period in which the revisions are determined. During the year ended December 31, 2012, we recorded $25.0 million of revenue under the percentage of completion method for solar energy sytems not involving real estate. There were no such amounts recognized in 2011 or 2010.

Solar energy system sales with service contracts

SunEdison frequently negotiates and executes solar energy system sales contracts and post-system-sale service contracts contemporaneously, which we combine and evaluate together as a single arrangement with multiple deliverables. The total arrangement consideration is first separated and allocated to post-system-sale separately priced extended warranty and maintenance service contracts, and the revenue associated with that deliverable is recognized on a straight-line basis over the contract term. The remaining consideration is allocated to each unit of accounting based on the respective relative selling prices, and revenue is recognized for each unit of accounting when the revenue recognition criteria have been met.

Sale with a leaseback

We are a party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. We must determine the appropriate classification of the sale leaseback on a project-by-project basis because the terms of the solar energy systems lease schedule may differ from the terms applicable to other solar energy systems. In addition, we must determine if the solar energy system is considered integral equipment to the real estate upon which it resides. We do not recognize revenue on the sales transactions for any sales with a leaseback. Instead, revenue is recognized through the sale of electricity and energy credits which are generated as energy is produced. The terms of the lease and whether the system is considered integral to the real estate upon which it resides may result in either one of the following sale leaseback classifications:

Capital lease arrangements

Sale/capital leaseback classification for non-real estate transactions occurs when the terms of the lease schedule for a solar energy system result in a capital lease classification. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system. Under a capital lease, a capitalized leased asset and obligation is recorded at the present value of the minimum lease payments. Any gain on the sale is recorded as a reduction of the capitalized leased asset which is then recognized to cost of goods sold through reduced depreciation expense over the term of the lease. As of the SunEdison acquisition date of November 20, 2009 through December 31, 2012, there were no arrangements which resulted in this accounting.

Financing arrangements

The financing method is applicable when we have determined that the assets under the lease are real estate. This occurs due to either a transfer of land or the transfer of a lease involving real estate and the leased equipment is integral equipment to the real estate. A sale leaseback is classified as a financing sale leaseback if we have concluded the leased assets are real estate and we have a prohibited form of continuing involvement, such as an option or obligation to repurchase the assets under our master lease agreements.

Under a financing sale leaseback, we do not recognize any upfront profit because a sale is not recognized. The full amount of the financing proceeds is recorded as solar energy financing debt, which is typically secured by the solar energy system asset and its future cash flows from energy sales, but generally has no recourse to MEMC or SunEdison under the terms of the arrangement.

We use our incremental borrowing rate to determine the principal and interest component of each lease payment. However, to the extent that our incremental borrowing rate will result in either negative amortization of the financing obligation or a built-in loss at the end of the lease (e.g. net book value of the system asset exceeds the financing obligation), the rate is adjusted to eliminate such results. The interest rate is adjusted accordingly for the majority of our financing leasebacks because our future minimum lease payments do not typically exceed the initial proceeds received from the buyer-lessor. As a result, most of our lease payments are reported as interest expense, the principal of the financing debt does not amortize, and we expect to recognize a gain upon the final lease payment at the end of the lease term equal to the unamortized balance of the financing debt less the write-off of the system assets net book value.

Operations and maintenance

Operations and maintenance revenue is billed and recognized as services are performed. Costs of these revenues are expensed in the period they are incurred.

Solar energy service revenues, energy credits and incentives

For SunEdison-owned or capitalized solar energy systems in the U.S., we may receive incentives or subsidies from various state governmental jurisdictions in the form of renewable energy credits (“RECs”), which we sell to third parties. In the State of California, we may also receive performance-based incentives (“PBIs”) from public utilities in connection with a program sponsored by the State of California. The Solar Energy segment recorded total PBI revenue of $31.4 million, $24.3 million and $18.6 million for the years ended December 31, 2012, 2011 and 2010, respectively, and total REC revenue of $17.3 million, $15.1 million and $7.5 million for the years ended December 31, 2012, 2011 and 2010, respectively. Both the RECs and PBIs are based on the actual level of output generated from the system. RECs are generated as our solar energy systems generate electricity. Typically, SunEdison enters into five to ten year binding contractual arrangements with utility companies or other investors who purchase RECs at fixed rates. REC revenue is recognized at the time SunEdison has transferred a REC pursuant to an executed contract relating to the sale of the RECs to a third party. For PBIs, production from SunEdison-operated systems is verified by an independent third party and, once verified, revenue is recognized based on the terms of the contract and the fulfillment of all revenue recognition criteria. There are no penalties in the event electricity is not produced for PBIs. However, if production does not occur on the systems for which we have sale contracts for our RECs, we may have to purchase RECs on the spot market or pay specified contractual damages. Historically, we have not had to purchase material amounts of RECs to fulfill our REC sales contracts.

Recording of a sale of RECs and receipt of PBIs under U.S. GAAP are accounted for under ASC 605, Revenue Recognition. There are no differences in the process and related revenue recognition between REC sales to utilities and non-utility customers. Revenue is recorded when all revenue recognition criteria are met, including: there is persuasive evidence an arrangement exists (typically through a contract), services have been rendered through the production of electricity, pricing is fixed and determinable under the contract and collectability is reasonably assured. For RECs, the revenue recognition criteria are met when the energy is produced and a REC is generated and transferred to a third party pursuant to a contract with that party fixing the price for the REC. For PBIs, revenue is recognized upon validation of the kilowatt hours produced from a third party metering company because the quantities to be billed to the utility are determined and agreed to at that time.

Derivative Financial Instruments and Hedging Activities

All derivative instruments are recorded on the consolidated balance sheet at fair value. Derivatives not designated as hedge accounting and used to hedge foreign-currency-denominated balance sheet items are reported directly in earnings along with offsetting transaction gains and losses on the items being hedged. Derivatives used to hedge foreign-currency denominated cash flows and floating rate debt may be accounted for as cash flow hedges, as deemed appropriate. Gains and losses on derivatives designated as cash flow hedges are recorded in other comprehensive (loss) income and reclassified to earnings in a manner that matches the timing of the earnings impact of the hedged transactions. The ineffective portion of all hedges, if any, is recognized currently in earnings. Derivatives used to manage the foreign currency exchange risk associated with a net investment denominated in another currency are accounted for as a net investment hedge. The effective portion of the hedge will be recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. When the investment is dissolved and MEMC recognizes a gain or loss in other income (expense), the associated hedge gain or loss in other comprehensive (loss) income will be reclassified to other income (expense).

Derivatives not designated as hedging

During 2006, we executed a long-term supply agreement with a customer, Suntech Power Holdings (“Suntech”). At the same time, we received a fully vested, non-forfeitable warrant to purchase common shares of Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The warrant becomes exercisable over a five year period (20% annually) beginning January 1, 2008 and has a five year exercise period from the date each tranche becomes exercisable. The estimated grant date fair value of the warrant was $66.6 million and was recorded to other assets with the offset to non-solar energy system deferred revenue – long-term on the consolidated balance sheet. The non-cash transaction was excluded from the consolidated statement of cash flows. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. We used a lattice model to determine the warrant’s fair value. The assumptions used in calculating the fair value of the warrant represented our best estimates, but these estimates involved inherent uncertainties and the application of our judgment.

We generally use currency forward contracts to manage foreign currency exchange risk relating to current trade receivables and payables with our foreign subsidiaries and current trade receivables and payables with our customers and vendors denominated in foreign currencies (primarily Japanese Yen and Euro). The purpose of our foreign currency forward contract activities is to protect us from the risk that the dollar net cash flows resulting from foreign currency transactions will be negatively affected by changes in exchange rates. We do not hold or issue financial instruments for speculative or trading purposes. Gains or losses on our forward contracts, as well as the offsetting losses or gains on the related hedged receivables and payables, are included in non-operating expense (income) in the consolidated statement of operations. Net currency losses on unhedged foreign currency positions totaled $6.6 million, $4.7 million and $0.5 million in 2012, 2011 and 2010, respectively.

Derivatives designated as hedging

In addition to the currency forward contracts purchased to hedge transactional currency risks, we may enter into currency forward contracts to hedge cash flow risks associated with future purchases of raw materials. Our cash flow hedges are designed to protect against the variability in foreign currency rates between a foreign currency and the U.S. Dollar. As of December 31, 2012, there were no currency forward contracts outstanding being accounted for as cash flow hedges.

We are party to four interest rate swap instruments, three of which are accounted for using hedge accounting. The interest rate swaps are used to manage risks generally associated with interest rate fluctuations. For those financial instruments that qualify for cash flow hedging in accordance with derivative instrument and hedging activities guidance, we have elected to use hedge accounting, whereby changes in the fair market value of the derivative instruments are reflected in the accompanying consolidated financial statements in other comprehensive (loss) income . The counterparties to these agreements are financial institutions. The fair values of the contracts are estimated by obtaining quotations from the financial institutions. The fair value is an estimate of the net amount that we would pay on December 31, 2012, if the agreements were transferred to other parties or cancelled by us.

Our previous joint venture with Q-Cells SE, which was not consolidated, was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract for 70.0 million Euros. The forward contract met all the criteria for hedge accounting and the derivative instrument was effective as an economic hedge of foreign exchange risk associated with the hedged net investment. The effective portion of the hedge was recorded in the same manner as foreign currency translation adjustment in other comprehensive (loss) income. During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our consolidated statement of operations, as the remaining investment in Q-Cells SE and related forward contracts were liquidated in the fourth quarter of 2010. See Note 5 for further discussion.

Translation of Foreign Currencies

We determine the functional currency of each subsidiary based on a number of factors, including the predominant currency for the subsidiary’s sales and expenditures and the subsidiary’s borrowings. When a subsidiary’s local currency is considered its functional currency, we translate its financial statements to U.S. Dollars as follows:

• Assets and liabilities using exchange rates in effect at the balance sheet date; and

• Statement of operations accounts at average exchange rates for the period.

Adjustments from the translation process are presented in accumulated other comprehensive (loss) income in stockholders’ equity.

Income Taxes

Deferred income taxes arise because of a different tax basis of assets or liabilities between financial statement accounting and tax accounting, which are known as temporary differences. We record the tax effect of these temporary differences as deferred tax assets (generally items that can be used as a tax deduction or credit in future periods) and deferred tax liabilities (generally items for which we receive a tax deduction, but have not yet been recorded in the consolidated statement of operations). We regularly review our deferred tax assets for realizability, taking into consideration all available evidence, both positive and negative, including historical pre-tax and taxable income (losses), projected future pre-tax and taxable income (losses) and the expected timing of the reversals of existing temporary differences. In arriving at these judgments, the weight given to the potential effect of all positive and negative evidence is commensurate with the extent to which it can be objectively verified. Reportable U.S. GAAP income from SunEdison's financing sale-leaseback transactions in the U.S. is deferred until the end of the lease term, generally 20-25 years, through the non-cash extinguishment of the debt.  However, sale-leaseback transactions generate current U.S. taxable income at the time of the sale, with the timing differences increasing deferred tax assets.  As a result of the continued decline in solar market conditions, the restructuring charges announced in December 2011, and cumulative losses in the U.S. and certain foreign jurisdictions, we recorded a material non-cash valuation allowance against the deferred tax assets at December 31, 2011. See Note 14 for further discussion.

We believe our tax positions are in compliance with applicable tax laws and regulations. Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in our tax returns that do not meet these recognition and measurement standards. Uncertain tax benefits, including accrued interest and penalties, are included as a component of other long-term liabilities because we do not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. The accrual of interest begins in the first reporting period that interest would begin to accrue under the applicable tax law. Penalties, when applicable, are accrued in the financial reporting period in which the uncertain tax position is taken on a tax return. We recognize interest and penalties related to uncertain tax positions in income tax expense, which is consistent with our historical policy. We believe that our income tax accrued liabilities, including related interest, are adequate in relation to the potential for additional tax assessments. There is a risk, however, that the amounts ultimately paid upon resolution of audits could be materially different from the amounts previously included in our income tax expense and, therefore, could have a material impact on our tax provision, net (loss) income and cash flows. We review our accrued liabilities quarterly, and we may adjust such liabilities due to proposed assessments by tax authorities, changes in facts and circumstances, issuance of new regulations or new case law, negotiations between tax authorities of different countries concerning our transfer prices between our subsidiaries, the resolution of entire audits, or the expiration of statutes of limitations. Adjustments are most likely to occur in the year during which major audits are closed.

Due to the restructuring announcement made in December 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future. We plan foreign remittance amounts based on projected cash flow needs as well as the working capital and long-term investment requirements of our foreign subsidiaries and our domestic operations.

We have made our best estimates of certain income tax amounts included in the financial statements. Application of our accounting policies and estimates, however, involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. In arriving at our estimates, factors we consider include how accurate the estimate or assumptions have been in the past, how much the estimate or assumptions have changed and how reasonably likely such change may have a material impact.

Stock-Based Compensation

Stock-based compensation expense for all share-based payment awards is based on the estimated grant-date fair value. We recognize these compensation costs net of an estimated forfeiture rate for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the option vesting term. For ratable awards, we recognize compensation costs for all grants on a straight-line basis over the requisite service period of the entire award. We estimate the forfeiture rate taking into consideration our historical experience during the preceding four fiscal years.

We routinely examine our assumptions used in estimating the fair value of employee options granted. As part of this assessment, we have determined that our historical stock price volatility and historical pattern of option exercises are appropriate indicators of expected volatility and expected term. The interest rate is determined based on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term of the award. We estimate the fair value of options using the Black-Scholes option-pricing model for our ratable and cliff vesting options. For our market condition awards, the grant date fair value was calculated for these awards using a probabilistic approach under a Monte Carlo simulation taking into consideration volatility, interest rates and expected term.

Contingencies

We are involved in conditions, situations or circumstances in the ordinary course of business with possible gain or loss contingencies that will ultimately be resolved when one or more future events occur or fail to occur. We continually evaluate uncertainties associated with loss contingencies and record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements; and (ii) the loss or range of loss can be reasonably estimated. Legal costs are expensed when incurred. Gain contingencies are not recorded until realized or realizable.

Shipping and Handling

Costs to ship products to customers are included in marketing and administration expense in the consolidated statement of operations. Amounts billed to customers, if any, to cover shipping and handling are included in net sales. Cost to ship products to customers were $24.6 million, $22.0 million and $20.7 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Fair Value Measurements

Fair value accounting guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, and are based on market data obtained from sources independent of MEMC. Unobservable inputs reflect assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

• Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that MEMC has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Because valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these instruments does not entail a significant degree of judgment.

• Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Valuations for Level 2 are prepared on an individual instrument basis using data obtained from recent transactions for identical securities in inactive markets or pricing data from similar instruments in active and inactive markets.

• Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We maintain various financial instruments recorded at cost in the December 31, 2012 and 2011 balance sheets that are not required to be recorded at fair value. For these instruments, we used the following methods and assumptions to estimate the fair value:

• Cash equivalents, restricted cash, accounts receivable and payable, customer deposits, income taxes receivable and payable, short-term borrowings, and accrued liabilities—cost approximates fair value because of the short maturity period; and

• Long-term debt—fair value is based on the amount of future cash flows associated with each debt instrument discounted at our current estimated borrowing rate for similar debt instruments of comparable terms.

Redeemable Noncontrolling Interest

Redeemable noncontrolling interests are equity interests in common stock of consolidated subsidiaries that have redemption features that are not solely within our control. These interests are classified as temporary equity because their redemption is considered probable. These interests are measured at the greater of estimated redemption value at the end of each reporting period or the initial carrying amount of the redeemable noncontrolling interests adjusted for cumulative earnings allocations.  Adjustments to report redeemable noncontrolling interests at estimated redemption value are determined after the attribution of net income or loss of the subsidiary and are recorded to retained earnings, or in the absence of retained earnings, additional paid-in-capital.

Accounting Standards Updates

In February 2012, the FASB issued Accounting Standards Update No. 2012-2 - Intangibles Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, which amends FASB ASU 2011-08 and states that companies can use a qualitative approach to measuring Intangibles, Goodwill and Other rather than a quantitative approach. In addition, it is not required for an entity to disclose the quantitative information about significant unobservable inputs used in fair value measurements categorized within level 3 of the fair value hierarchy required by paragraph 820-10-50-2 that relate to the financial accounting and reporting for an indefinite-lived intangible asset after its initial recognition. We do not expect that the adoption of ASU Update No. 2012-2 will have a material impact on our consolidated financial statements.

In June 2011, the FASB issued Accounting Standards Update 2011-05 ("ASU 2011-05"), Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 allows an entity to present components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. This standard was adopted on January 1, 2012, and we have presented components of net income (loss) and other comprehensive income (loss) in one continuous statement for the quarter ended periods March 31, 2012, June 30, 2012 and September 30, 2012. For the year-ended December 31, 2012, comprehensive income (loss) is presented as a stand alone financial statement.

In October 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2009-13 (“ASU 2009-13”), which updates the current guidance pertaining to multiple-element revenue arrangements included in ASC Subtopic 605-25, Multiple-Element-Arrangements. The Company adopted this guidance on January 1, 2011.

Supplemental Cash Flow Information

Following is information related to interest and taxes paid as well as certain non-cash investing and financing activities including acquisition related items:

	For the year ended December 31,
	2012		2011			2010
In millions
Supplemental disclosures of cash flow information:
Interest payments (including debt issuance costs), net of amounts capitalized	$	170.9	$	155.9		$	22.2
Income taxes paid (refunded), net	40.9		13.7			(9.4		)
Supplemental schedule of non-cash investing and financing activities:
Accounts payable incurred (relieved) for acquisition of fixed assets, including solar energy systems	$	49.7	$	(68.0	)	$	138.7
Debt transferred to and assumed by buyer upon sale of solar energy systems	403.1		104.6			43.3
Conversion of note payable to equity	—		—			27.0
Acquisitions:
Fair value of assets acquired	$	—	$	334.5		$	65.2
Goodwill	—		97.8			56.4
Liabilities assumed and noncontrolling interests	—		(158.0		)	(19.9		)
Loans prior to acquisition	—		(16.0		)	(26.0		)
Other non-cash consideration	—		(90.7		)	—
Less: cash acquired	—		(3.6		)	(2.2		)
Cash paid, net of cash acquired	$	—	$	164.0		$	73.5

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Income Taxes

12 Months Ended

Dec. 31, 2012

Income Tax Expense (Benefit) [Abstract]

INCOME TAXES

INCOME TAXES

The net loss before income tax expense (benefit) and equity in (loss) earnings of joint ventures consists of the following:

	For the year ended December 31,
	2012			2011			2010
In millions
U.S.	$	(261.1	)	$	(780.6	)	$	(157.8	)
Foreign	179.6			(603.5		)	145.3
Total	$	(81.5	)	$	(1,384.1	)	$	(12.5	)

Income tax expense (benefit) consists of the following:

	Current			Deferred			Total
In millions
Year ended December 31, 2012:
U.S. Federal	$	38.9		$	(0.2	)	$	38.7
State and local	(14.0		)	0.7			(13.3		)
Foreign	47.5			(8.0		)	39.5
Total	$	72.4		$	(7.5	)	$	64.9
Year ended December 31, 2011:
U.S. Federal	$	6.7		$	37.2		$	43.9
State and local	4.6			4.7			9.3
Foreign	15.9			4.0			19.9
Total	$	27.2		$	45.9		$	73.1
Year ended December 31, 2010:
U.S. Federal	$	(46.6	)	$	(29.6	)	$	(76.2	)
State and local	(3.8		)	(2.3		)	(6.1		)
Foreign	44.2			(15.2		)	29.0
Total	$	(6.2	)	$	(47.1	)	$	(53.3	)

Effective Tax Rate

Income tax expense (benefit) differed from the amounts computed by applying the statutory U.S. federal income tax rate of 35% to loss before income taxes and equity in (loss) earnings of joint ventures. The “Effect of foreign operations” includes the net reduced taxation of foreign profits from combining jurisdictions with rates above and below the U.S. federal statutory rate and the impact of U.S. foreign tax credits.

	For the year ended December 31,
	2012		2011		2010
Income tax at federal statutory rate	(35.0	)%	(35.0	)%	(35.0	)%
Increase (reduction) in income taxes:
Effect of foreign operations	(71.6	)	19.3		(47.4	)
Foreign incentives	(5.7	)	(1.1	)	(121.6	)
Foreign repatriation	(2.1	)	0.4		(91.7	)
State income taxes, net of U.S. Federal benefit	(16.6	)	0.7		(26.8	)
Tax authority positions, net	3.8		1.2		(97.0	)
Valuation allowance	183.2		15.1		—
Other, net	23.6		4.7		(6.9	)
Effective tax expense (benefit) rate	79.6	%	5.3	%	(426.4	)%

The 2012 net expense is primarily the result of the worldwide operational earnings mix at various rates, charges recognized to establish valuation allowances on certain deferred tax assets due to the likely inability to realize benefit for certain future tax deductions, a net increase to the reserve for uncertain tax positions, and the impact of examination of tax returns by the Internal Revenue Service (“IRS”), partially offset by the release of a valuation allowance in a foreign jurisdiction.

The 2011 net expense is primarily the result of charges taken to value certain deferred tax assets as a result of the continued decline in solar market conditions, the restructuring charges announced on December 8, 2011, and cumulative losses in the U.S. and certain foreign jurisdictions. The domestic impact is the combination of charges taken related to certain deferred tax and the impact, including foreign tax credits, of the deemed repatriation of the earnings of certain foreign subsidiaries. The foreign impact is a net tax expense lower than the U.S. federal income tax rate due to lower statutory tax rates, available tax incentives and reserves for uncertain tax positions. The 2010 net benefit is the result of a benefit associated with the mix of earnings and losses amongst domestic and foreign locations.

Certain of our Asian subsidiaries have been granted a concessionary tax rate of between 0% and 5% on all qualifying income for a period of up to five to ten years based on investments in certain plant and equipment and other development and expansion activities, resulting in a tax benefit for 2012, 2011 and 2010 of approximately $4.6 million, $15.7 million and $15.0 million, respectively. Under the awards, the income tax rate for qualifying income will be taxed at an incentive tax rate lower than the corporate tax rate. The company is in compliance with the qualifying condition of their tax incentives. The last of these incentives will expire between 2013 and 2022.

During the quarter ended June 30, 2010, we concluded an IRS examination for the 2006 and 2007 tax years and, as a result, we recorded favorable and unfavorable adjustments to our accrual for uncertain tax positions. We received proposed taxable income adjustments from the IRS related to various cost allocations and taxable income adjustments attributable to our foreign operations. The settlement of those positions resulted in an increase to the accrual of $29.9 million. The resolution of these matters resulted in an assessment of $31.6 million, which included penalties and interest of $5.0 million, net of $2.3 million of federal benefit. Additionally, MEMC had uncertain tax positions for deductions and tax credits that were effectively settled during the exam which reduced the accrual by $51.0 million. The net effect to our tax provision for the closure of the exam was a $15.5 million tax benefit.

We are currently under examination by the IRS for the 2008, 2009 and 2010 tax years. Additionally, due to the carryback of our 2009 net operating loss for utilization against the 2007 tax liability, the IRS has re-opened the 2007 tax year for further review. We believe it is reasonably possible that some portions of the examination could be completed within the next twelve months; however, the results of the examination and any potential settlement are not reasonably estimable at this time.

During 2009, we determined that the undistributed earnings of one of our foreign wholly-owned subsidiaries would be remitted to the U.S. in the foreseeable future. These earnings were previously considered permanently reinvested in the business, and the deferred tax asset related to these earnings was not recognized. The deferred tax effect of this newly planned remittance was recorded as a discrete net income tax benefit in the amount of $2.4 million in the year ended December, 31 2009 and an additional benefit of $11.3 million for the year ended December 31, 2010. Due to the restructuring announcement made on December 8, 2011, we reviewed our policy for repatriation of all our subsidiaries. Based on this review, it was determined that the undistributed earnings of all our foreign subsidiaries are not expected to be remitted to the U.S. parent corporation in the foreseeable future, and the deferred tax benefit previously recorded of $13.4 million has been reversed in 2011. Federal and state income taxes have not been provided on accumulated but undistributed earnings of foreign subsidiaries aggregating approximately $382.7 million and $1,031.6 million at December 31, 2012 and 2011, respectively, because such earnings have been permanently reinvested in the business. The determination of the amount of the unrecognized deferred tax liability related to our undistributed earnings is not practicable.

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

	For the year ended December 31,
	2012			2011
In millions
Beginning of year	$	46.2		$	30.4
Additions based on tax positions related to the current year	7.8			15.9
Reductions for tax positions of prior years	(3.1		)	(0.1		)
End of year	$	50.9		$	46.2

At December 31, 2012 and 2011, we had $53.2 million and $48.3 million, respectively, of unrecognized tax benefits, net of U.S. federal, state and local deductions, associated with open tax years for which we are subject to audit in various U.S. federal, and various state and foreign jurisdictions. This also includes estimated interest and penalties. The current change to the reserve includes an increase of $4.7 million primarily related to taxable income adjustments attributable to foreign operations. All of our unrecognized tax benefits at December 31, 2012 and 2011 would favorably affect our effective tax rate if recognized. We are subject to examination in various jurisdictions for the 2003 through 2011 tax years.

During the years ended December 31, 2012 and 2011, we recognized approximately $0.2 million and $0.4 million, respectively, in interest and penalties and had approximately $2.3 million and $2.1 million accrued at December 31, 2012 and 2011, respectively, for the payment of interest and penalties.

Deferred Taxes

The tax effects of the major items recorded as deferred tax assets and liabilities are:

	As of December 31,
	2012			2011
In millions
Deferred tax assets:
Inventories	$	14.9		$	17.1
Restructuring liabilities	31.2			42.5
Expense accruals	52.0			53.1
Solar energy systems	461.9			366.7
Deferred revenue	66.3			4.4
Property, plant and equipment	35.7			54.1
Pension, medical and other employee benefits	12.2			27.2
Foreign repatriation	3.4			3.4
Net operating loss carryforwards	132.3			91.5
Foreign tax credits	70.8			28.8
Other	75.6			38.4
Total deferred tax assets	956.3			727.2
Valuation allowance	(510.5		)	(415.7		)
Net deferred tax assets	445.8			311.5
Deferred tax liabilities:
Solar energy systems	(286.7		)	(191.2		)
Other	(74.2		)	(12.4		)
Total deferred tax liabilities	(360.9		)	(203.6		)
Net deferred tax assets	$	84.9		$	107.9

The solar energy systems deferred tax asset of $461.9 million is entirely associated with the Solar Energy segment. For tax purposes, income is recognized in the initial transaction year for all solar system sales and sale leasebacks; Note 2 discusses the book accounting for each of the different revenue recognition policies. The deferred tax asset represents the future disallowance of deferred book revenue recognized in post transaction years.

Our deferred tax assets and liabilities, netted by taxing location, are in the following captions in the consolidated balance sheet:

	As of December 31,
	2012			2011
In millions
Current deferred tax assets, net (recorded in prepaids and other current assets)	$	90.8		$	63.1
Non-current deferred tax (liabilities) assets, net	(5.9		)	44.8
Total	$	84.9		$	107.9

Our net deferred tax assets totaled $84.9 million at December 31, 2012 compared to $107.9 million at December 31, 2011. In 2012, the decrease of $23.0 million in net deferred tax assets is primarily attributable to a net increase in valuation allowances of $94.8 million, partially offset by additional deferred tax assets associated with future disallowances of deferred book revenue for solar energy systems. Deferred tax assets generated in 2012 were reduced by recognizing an increase in the valuation allowance associated with our U.S. operations, which were in a three-year cumulative loss position in both 2011 and 2012. This contributed to the majority of the increase in the valuation allowance in 2012. At December 31, 2012, we have valuation allowances of $510.5 million. We believe that it is more likely than not, with our projections of future taxable income in certain jurisdictions, that we will generate sufficient taxable income to realize the benefits of the net deferred tax assets of $84.9 million. At December 31, 2012, we had deferred tax assets associated with net operating loss carryforwards of $6.9 million in certain foreign jurisdictions; if unused, these will expire in 2022.

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Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

The carrying values of intangible assets at December 31, 2012 and December 31, 2011 are as follows:

		December 31, 2012							December 31, 2011
Dollars in millions	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount		Gross Carrying Amount		Accumulated  Amortization or Allocated to Solar Energy System			Net Carrying Amount
Amortizable intangible assets:
Favorable energy credits	7	$	14.2	$	(9.0	)	$	5.2	$	14.2	$	(6.1	)	$	8.1
Customer relationships(1)	6	5.7		(2.4		)	3.3		5.7		(1.6		)	4.1
Trade name	15	4.1		(0.9		)	3.2		4.1		(0.6		)	3.5
Internally developed software	4	1.3		(1.3		)	—		1.7		(1.0		)	0.7
Developed technology(1)	5	12.0		(6.0		)	6.0		13.9		(5.5		)	8.4
Non-compete agreement	1	1.2		(1.2		)	—		1.2		(0.4		)	0.8
Total amortizable intangible assets		$	38.5	$	(20.8	)	$	17.7	$	40.8	$	(15.2	)	$	25.6
Indefinite lived assets:
In-process technology(1)	Indefinite	$	0.9	$	—		$	0.9	$	1.5	$	—		$	1.5
Power plant development arrangements(2)	Indefinite	143.3		(47.7		)	95.6		143.3		(21.2		)	122.1
Total indefinite lived assets		$	144.2	$	(47.7	)	$	96.5	$	144.8	$	(21.2	)	$	123.6

____________________ 

⁽¹⁾  These intangibles represent the amounts acquired in the SunEdison, Solaicx and other acquisitions. The useful life for in-process technology will be determined once the research and development process is complete and, at that time, amortization of the asset will begin.

⁽²⁾  Power plant development arrangements are allocated to the solar energy system (property, plant and equipment or inventory) upon completion of the related solar energy systems stemming from the backlog at the date of acquisition. Depending on the classification of the system, held for development and sale or property, plant and equipment will determine whether the intangible is amortized to cost of goods sold or to depreciation expense. Includes $82.6 million, net of amortization, acquired in the FRV U.S. acquisition.

In 2012, 2011 and 2010, we recognized amortization expense of $34.6 million, $9.4 million and $5.9 million, respectively. We incurred impairment charges of $1.2 million and $6.6 million, primarily on our developed technology intangible assets, for the years ended December 31, 2012 and 2011, respectively. No similar charges were recorded in 2010.

We expect to recognize annual expense on our amortizable intangible assets as follows:

	2013		2014		2015		2016		2017
In millions
Amortization	$	6.9	$	4.4	$	1.7	$	1.2	$	0.5

Goodwill Impairments

In 2011, the entire carrying amount of Goodwill was impaired and was recorded to goodwill impairment charges in the consolidated statement of operations.

During 2011, the Solar Energy segment included the Solar Materials reporting unit and the former Solar Energy reporting unit, both of which carried a goodwill balance. We perform our annual goodwill impairment test on December 1 of each year, however, due to deteriorating economic conditions in the solar industry, we performed an interim impairment analysis in the quarter ended September 30, 2011. During the interim period ended September 30, 2011, we evaluated whether impairment indicators existed which would require a detailed test of goodwill for impairment as of an interim date. As of September 30, 2011, our net book value was significantly above the market capitalization of our common stock. During June 2011 and continuing through September 2011, we observed a strong correlation between the decline in our market capitalization and the decline in pricing in the solar wafer market, caused by an overall softening of demand in the solar materials supply chain. We evaluated the following items, among others, in determining whether there were impairment indicators requiring an evaluation of goodwill impairment as of an interim date: the impact of solar wafer price declines on our Solar Materials reporting unit and on our raw material costs for our Solar Energy reporting unit; advanced materials technologies at our Solar Materials reporting unit; the financial performance of each reporting unit in fiscal year 2011 to date; and our internal forecast data. We determined that there were indicators of potential impairment due to the items previously mentioned and the sustained decline in our common stock price resulting in a market capitalization below book value. Based on the above, we determined that there was a triggering event, which required us to perform a Step 1 goodwill impairment analysis for the interim period ended September 30, 2011 on both the Solar Materials and Solar Energy reporting units' goodwill.

We prepared a discounted cash flow (“DCF”) model for each of the reporting units to assess the recoverability of the goodwill using significant unobservable inputs (Level 3), which we then reconciled to our average market capitalization over a reasonable period of time, which included a control premium supported by recent transactions, as of September 30, 2011. For our DCF models, we used inputs we believed a market participant would use, including earnings projections and other cash flow assumptions over future periods plus a terminal value assuming a long-term growth rate. We believe the DCF model represents a reliable valuation method for this purpose because it reflects the information a market participant would likely use to value each of the reporting units.

Solar Materials reporting unit

In performing this test for our Solar Materials reporting unit, we made a downward revision in the forecasted cash flows as a result of a decrease in the market price for silicon products and weaker demand for solar products. Our analysis also included considerations of our market capitalization. Based on the results of our analysis in which we estimated the fair value of the goodwill as of September 30, 2011, we concluded that the carrying value of goodwill exceeded its fair value and, as a result, recorded an impairment charge totaling $56.4 million during the quarter ended September 30, 2011. This impairment charge was entirely associated with our Solaicx acquisition completed in July 2010 and represented the full carrying value of the goodwill related to the Solar Materials reporting unit.

Solar Energy reporting unit

Based on the impairment test performed during the interim period, it was determined that there was no impairment of goodwill of the Solar Energy reporting unit as of September 30, 2011 given that the estimated fair value of the Solar Energy reporting unit based on our forecast was in excess of its carrying value. Management's assumptions were based on an analysis of current and expected future economic conditions and the updated strategic plan for this reporting unit. Key assumptions in the calculation of fair value were the discount rate, growth rates in sales and profit margins and long-term cash forecasts, as well as our reconciliation to our market capitalization. The assumptions used in our valuation model included projected growth of our business including pipeline and new business, expected cost reductions and future price declines. We utilized a discount rate which we believed was commensurate with the then current volatility in earnings and cash flows in the solar industry. The estimated fair value of the Solar Energy reporting unit at September 30, 2011 based on our forecast, after analyzing various data points, including our market capitalization, was in excess of the carrying value.

During the three months ended December 31, 2011, conditions in the solar industry continued to decline, including selling prices of solar energy systems. These declines were due to continued softening in demand for the systems, including recent announcements of decreases in government funded solar energy subsidies. We believe these economic factors caused our market capitalization to deteriorate during the three months ended December 31, 2011. We performed an updated analysis to estimate the fair value of our Solar Energy reporting unit, which included a reconciliation by reporting unit to our market capitalization. The carrying value was in excess of fair value requiring a Step 2 analysis to be performed. The Step 2 goodwill impairment analysis required that we estimate the fair values of all assets and liabilities and compare the resulting net assets to our estimated fair value of the reporting unit. The estimate of fair values included Level 1, 2 and 3 inputs and included assumptions such as the replacement cost of property, plant and equipment, sales value of inventories and work-in-process and debt fair values based on rates a market participant would use. Based on this analysis, the estimated fair value of the Solar Energy reporting unit was determined to be below the estimated fair value of the net assets and goodwill was estimated to be zero. Therefore, we impaired the goodwill of the Solar Energy reporting unit of $384.1 million in the three month period ended December 31, 2011. After this impairment charge, which included goodwill associated with the acquisitions of SunEdison, FRV U.S., and three other 2011 acquisitions, the goodwill balance was zero as of December 31, 2011.

Changes in goodwill for the year ended December 31, 2011 are as follows:

In millions	January 1, 2011		Acquisitions (see Note 4)		Impairments			December 31, 2011
Solar Energy	$	342.7	$	97.8	$	(440.5	)	$	—
Total	$	342.7	$	97.8	$	(440.5	)	$	—

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Stockholders' Equity (Outstanding Restricted Stock) (Details) (Restricted Stock Units (RSUs) [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012 Y
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Aggregate Intrinsic Value	$ 13.7
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward]
Beginning of year	4,692,159
Granted	1,469,549
Converted	(680,611)
Forfeited	(1,079,329)
End of year	4,401,768
End of year, Weighted Average Remaining Contractual Life (in years)	2

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Investments

12 Months Ended

Dec. 31, 2012

Investments [Abstract]

INVESTMENTS

INVESTMENTS

The carrying value of short-term and long-term investments consists of the following:

	As of December 31,
	2012		2011
In millions
Equity method investments	$	23.3	$	25.8
Equity investments at cost	12.9		12.5
Items measured at fair value on a recurring basis	13.4		16.2
Time deposits	0.3		0.3
Total investments	49.9		54.8
Less: short-term investments	0.3		0.3
Non-current investments	$	49.6	$	54.5

Equity Method Investments

We have made equity method investments, which are primarily joint ventures, totaling $43.4 million during the year ended December 31, 2012. The accounting for the investments is described below. Generally, these investments are designed to create additional capacity in our Solar Energy segment. Our aggregate remaining contractual investment commitments to our joint ventures as of December 31, 2012 is up to an additional $117.7 million. The contracts governing these joint ventures generally do not have any specific time frames for these future investments, however, we expect to fund approximately $105.0 million of these commitments in 2013.

Due to adverse solar market conditions and expected future reduced sales volumes, our equity method joint venture, Jiangsu Meike Silicon Energy Co. LTD., ("Meike" and formerly the Zhenjiang Huantai joint venture), recorded an impairment charge related to the joint venture's long-lived assets in the fourth quarter of 2011. In addition, in the fourth quarter of 2011 we determined that a loss in value in another equity method investment occurred and was other than temporary. We recorded impairment charges totaling $67.3 million on our equity method investments in 2011. During the year ended December 31, 2012, no equity method investment impairments were recorded.

Samsung Fine Chemicals Joint Venture

In February 2011, we entered into an equity method joint venture with Samsung Fine Chemicals Co. Ltd. (the "SMP JV") for the construction and operation of a new facility to produce high purity polysilicon in Ulsan, South Korea. The SMP JV will manufacture and supply polysilicon to us and to international markets. MEMC Singapore Pte. Ltd.'s. ownership interest in the joint venture is 50% and Samsung Fine Chemicals Co. Ltd. owns the other 50%.

In September 2011, we executed a Supply and License Agreement with the SMP JV under which MEMC will license and sell to the joint venture certain technology and related equipment used for producing polysilicon. We will receive proceeds under the Supply and License Agreement based on certain milestones being achieved throughout the construction, installation and testing of the equipment, which is expected to occur primarily over the next 12 months. Proceeds received from the SMP JV under the Supply and License Agreement will be recorded as a reduction in our basis in the SMP JV investment and to the extent that our basis in the investment is zero, the remaining proceeds received will be recorded as a long-term liability. To the extent the total cash proceeds received exceed the sum of our cost basis in the equipment plus our capital contributions to the SMP JV and when we have no remaining performance obligations, a net gain would be recognized on the transaction.

During the year ended December 31, 2012, under the Supply and License Agreement we made total equity contributions of $43.4 million. Since inception of the SMP JV, the proceeds received have exceeded our investment, and we recorded this as a reduction in our equity investment balance with the excess of $30.5 million recorded in long-term customer and other deposits. The cash received is recorded as an investing inflow within the consolidated statement of cash flows. As of December 31, 2012, and December 31, 2011 our investment balance in the SMP JV was $0. Our total cash commitments, inclusive of the $57.3 million invested thus far, are expected to be approximately $175.0 million through 2014. We expect our remaining cash commitments to be substantially offset by proceeds received under the Supply and License Agreement.

Equity Investments at Cost

During the years ended December 31, 2012 and 2011, we recorded an other-than-temporary impairment charge of $3.6 million and $11.6 million, respectively, associated with one of our cost method investments. The impairment was a result of the length and severity of a fair value decline below our cost basis, with no turnaround in the foreseeable future. We have assessed and determined that there have been no other events or circumstances that had a material adverse effect on our other cost method investments during this period. No similar charges were recorded in 2010.

Investments Recorded at Fair Value

At December 31, 2012, we held an investment in equity securities of a customer’s common stock, Gintech Energy Corporation ("Gintech"), acquired in connection with the execution of a long-term supply agreement. This investment is accounted for at fair value, is classified as a long-term available-for-sale investment and has a cost basis of $12.4 million.

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Acquisitions (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended			3 Months Ended	12 Months Ended			3 Months Ended	12 Months Ended		12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011 Solar Energy [Member]	Dec. 31, 2012 Solar Energy [Member]	Dec. 31, 2011 Solar Energy [Member]	Dec. 31, 2010 Solar Energy [Member]	Dec. 31, 2012 FRV US [Member]	Dec. 31, 2012 FRV US [Member]	Sep. 02, 2011 FRV US [Member]	Dec. 31, 2011 Solaicx [Member]	Dec. 31, 2012 Solaicx [Member]	Jun. 30, 2011 Solaicx [Member]	Dec. 31, 2012 SunEdison [Member]	Feb. 01, 2011 SunEdison [Member]	Jun. 30, 2012 SunEdison [Member] Company One Acquired [Member]	Jun. 30, 2012 SunEdison [Member] Company One Acquired [Member] Solar Energy [Member]	Dec. 31, 2012 SunEdison [Member] Two Companies Acquired [Member]	Dec. 31, 2012 Subsequent Event [Member] SunEdison [Member]	Jul. 06, 2012 Subsequent Event [Member] SunEdison [Member]
Business Acquisition [Line Items]
Business Acquisition, Cost of Acquired Entity, Cash Held In Escrow													$ 2.0
Business Acquisition, Percentage of Voting Interests Acquired											100.00%			100.00%			100.00%		100.00%
Business Acquisition, Cost of Acquired Entity, Purchase Price											187.8			101.7			72.6		14.3
Business Acquisition, Contingent Consideration, Potential Cash Payment											54.2						27.0
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High		67.1												71.8	39.5
Deferred Tax Assets, Operating Loss Carryforwards	91.5	132.3	91.5								9.3		26.1
Business Acquisition, Purchase Price Allocation, Goodwill Amount											44.6			56.4			43.8	43.8	9.4
Business Acquisition, Purchase Price Allocation, Goodwill, Expected Tax Deductible Amount											0
Revenues		1,794.6	2,268.0	1,996.4						121.2
Net Income (Loss) Attributable to Parent		(150.6)	(1,536.0)	34.4						(48.3)		(11.2)
Business Acquisition, Pro Forma Net Income (Loss)		150.6	1,536.0	(34.4)						48.3		11.2
Goodwill, Impairment Loss	384.1	0	440.5	0	384.1	440.5	440.5	0	44.6
Business Acquisition Purchase Price Allocation Goodwill Not Tax Deductible Amount																	24.4
Business Acquisition, Purchase Price Allocation, Intangible Assets											115.5			21.0			13.0		4.8
Business Acquisition, Contingent Consideration, at Fair Value		24.9												(26.0)					6.5
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, Low														60.0
Business Combination, Contingent Consideration, Potential Additional Payment in Cash and Common Stock														27.6
Contingent consideration related to acquisitions	71.6	23.1	71.6											26.0
Business Combination, Acquisition Related Costs												1.9
Contingent Consideration Paid In Cash																				$ 13.6	$ 66.4
Contingent Consideration Common Stock Issued																2.1

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Acquisitions

12 Months Ended

Dec. 31, 2012

Business Combinations [Abstract]

ACQUISITIONS

Acquisitions

On September 2, 2011, we completed the acquisition of 100% of the voting shares of Fotowatio Renewable Ventures, Inc. (“FRV U.S."), a developer of solar power projects in the U.S. The FRV U.S. acquisition expanded our pipeline of solar power projects and supports our expansion in the U.S. utility-scale power market. The purchase price was $187.8 million, including estimated contingent consideration fair valued at $54.2 million. The estimated acquisition date fair value of the contingent consideration reflected a discount at a credit adjusted interest rate for the period of the contingency. That measure was based on significant inputs that were not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions included (i) a discount percentage and (ii) a probability adjustment related to the operational metrics being met. On July 6, 2012, contingent consideration related to the acquisition of FRV U.S. was paid in full in the amount of $66.4 million. The difference between the initial estimate of the contingent consideration and the amount ultimately paid was recorded as an expense in the consolidated statement of operations.

The table below represents the allocation of the total consideration of tangible and intangible assets acquired and liabilities assumed from FRV U.S. based on an estimate of the fair value at the acquisition date:

In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	1.8
Solar energy systems held for development	64.2
Other current assets	9.0
Property, plant and equipment, net	23.0
Goodwill	44.6
Intangible assets	115.5
Other noncurrent assets	50.2
Current liabilities	(3.4		)
Short-term debt	(32.9		)
Other long-term liabilities	(44.6		)
Noncontrolling interests	(39.6		)
Total purchase price	$	187.8

At the date of acquisition, FRV U.S. had net operating losses that we expect will be realizable on MEMC's consolidated U.S. tax return, subject to annual Internal Revenue Code Section 382 limitations. Deferred tax assets attributable to these FRV U.S. net operating loss carry forwards of $9.3 million are included in other noncurrent assets in the table above. All of the goodwill was assigned to the Solar Energy segment and no goodwill was deductible for U.S. income tax purposes. The primary factors which resulted in recognition of goodwill included the assembled workforce and synergies in skill sets and operations. The amount of FRV U.S. revenue and operating loss included in the consolidated statement of operations for the year ended December 31, 2011 was $121.2 million and $48.3 million, respectively. The 2011 operating loss included a $44.6 million impairment of FRV U.S. goodwill during the three months ended December 31, 2011. See Note 10. We have not provided proforma financial information because the acquisition was not considered significant.

Other 2011 acquisitions

During the second quarter of 2011, SunEdison completed the acquisition of 100% of the voting equity of a company for a purchase price of $72.6 million, of which an estimated $27.0 million related to contingent consideration payable in cash. In the fourth quarter of 2012, contingent consideration related to this acquisition was paid in the amount of $13.6 million and the remainder is expected to be paid in 2013. This acquisition, which included project pipeline, is intended to further develop our solar energy systems' business and leverage the synergies in our Solar Energy segment. We recorded $43.8 million to goodwill, approximately $24.4 million of which is not deductible for tax purposes, and $13.0 million to intangible assets. All $43.8 million of goodwill was allocated to the Solar Energy segment and was subsequently written-off during the three months ended December 31, 2011. See Note 10. We have not provided proforma financial information because the acquisition was not considered significant.

During 2011, SunEdison completed two other acquisitions of 100% of the voting equity of these companies for a combined total purchase price of $14.3 million, of which $6.5 million relates to contingent consideration. We recorded $9.4 million and $4.8 million to goodwill and acquired intangible assets, respectively. The goodwill is not deductible for tax purposes for either of these acquisitions and was subsequently written-off during the three months ended December 31, 2011. See Note 10.

On July 1, 2010, we completed the acquisition of 100% of the voting equity of Solaicx, which became a wholly owned subsidiary of MEMC. The U.S. GAAP purchase price for Solaicx was $101.7 million, including cash and additional contingent consideration. The contingent consideration consists of cash and MEMC common stock, as elected by certain Solaicx shareholders.

The purchase price was calculated as follows:

In Millions
Cash	$	75.7
Contingent consideration	26.0
Total purchase price including estimated contingent consideration	$	101.7

Approximately $2.0 million of the cash consideration is currently held in escrow pursuant to the terms of the merger agreement and was reflected in goodwill. The contingent consideration was to be paid to the former Solaicx shareholders if certain operational criteria were met from July 1, 2010 through December 31, 2011. The amount payable is based on Solaicx achieving revenues of at least $60.0 million during such time period, up to a maximum revenue target of $71.8 million, with the payout on a linear basis between those two amounts. This would entitle the former Solaicx shareholders to up to an additional $27.6 million of a combination of cash and MEMC common stock. MEMC estimated the acquisition date fair value of the contingent consideration at $26.0 million, which reflects a discount at a credit adjusted interest rate for the period of the contingency. That measure was based on significant inputs that are not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions included (i) a discount percentage and (ii) a probability adjusted level of revenue expected to be achieved by Solaicx during the period between July 1, 2010 and December 31, 2011. Since the date of the acquisition, the revenue targets have not been met and we have reduced the estimated liability associated with the contingent consideration based on our revised estimates. This reduction was recognized in the statement of operations. The former Solaicx shareholders are disputing the Company's determination that the revenue targets were not met and the matter is subject to a binding arbitration proceeding.

The primary factor which resulted in recognition of goodwill, as well as our primary reason for the acquisition of Solaicx, was that the acquisition would allow us to produce high efficiency monocrystalline solar wafers at competitive costs. All of the goodwill was assigned to the Solar Energy segment and no goodwill is deductible for U.S. income tax purposes. See Note 10 regarding discussion of the subsequent impairment of all of this goodwill.

The table below represents the allocation of the total consideration to tangible and intangible assets acquired and liabilities assumed from Solaicx based on an estimate of the fair value at the acquisition date:

In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	2.2
Other current assets	11.6
Property, plant and equipment, net	30.0
Goodwill	56.4
Intangible assets	21.0
Other noncurrent assets	0.4
Current liabilities	(12.2		)
Long-term debt and capital lease obligations, excluding current portion	(1.3		)
Other long-term liabilities	(6.4		)
Total purchase price	$	101.7

Acquisition related costs of $1.9 million were included in marketing and administration expense, and the amount of Solaicx’s loss of $11.2 million from the date of acquisition was included in the consolidated statement of operations for the year ended December 31, 2010 and was dilutive to earnings per share. The amount of Solaicx’s revenue included in the consolidated statement of operations for the same period was not material. See a description of intangible assets in Note 10.

Upon acquisition, Solaicx had net operating losses that would be realizable on MEMC’s consolidated U.S. tax return, subject to annual Internal Revenue Code Section 382 limitations. At December 31, 2012, we had deferred tax assets attributable to these Solaicx net operating loss carry forwards of $26.1 million and a corresponding valuation allowance of $26.1 million, reducing the net deferred tax asset for net operating losses to zero.

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Derivatives and Hedging Instruments

12 Months Ended

Dec. 31, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES AND HEDGING INSTRUMENTS

DERIVATIVES AND HEDGING INSTRUMENTS

MEMC’s hedging activities consist of:

		Assets (Liabilities or Equity) Fair Value
In millions	Balance Sheet Location	As of December 31, 2012			As of December 31, 2011
Derivatives designated as hedging:
Interest rate swaps	Accrued liabilities	$	(5.0	)	$	(4.5	)
Interest rate swaps	Accumulated other comprehensive income	$	4.3		$	3.9
Derivatives not designated as hedging:
Suntech warrant	Other assets	$	0.2		$	0.4
Currency forward contracts	Prepaid and other current assets	$	0.5		$	3.0
Currency forward contracts	Accrued liabilities	$	(7.1	)	$	(1.8	)
Interest rate swaps	Accrued liabilities	$	—		$	(1.1	)
		Losses (Gain)
In millions	Statement of Operations Location	Year Ended December 31, 2012			Year Ended December 31, 2011			Year Ended December 31, 2010
Derivatives designated as hedging:
Net investment hedge	Other, net	$	—		$	—		$	(17.3	)
Derivatives not designated as hedging:
Suntech warrant	Decline in fair value of warrant	$	0.2		$	4.8		$	14.0
Currency forward contracts	Other, net	$	9.0		$	7.4		$	1.3

To mitigate financial market risks of fluctuations in foreign currency exchange rates, we utilize currency forward contracts. We do not use derivative financial instruments for speculative or trading purposes. We generally hedge transactional currency risks with currency forward contracts. Gains and losses on these foreign currency exposures are generally offset by corresponding losses and gains on the related hedging instruments, reducing the net exposure to MEMC. A substantial portion of our revenue and capital spending is transacted in the U.S. Dollar. However, we do enter into transactions in other currencies, primarily the Euro, the Japanese Yen, Canadian dollar and certain other Asian currencies. To protect against reductions in value and volatility of future cash flows caused by changes in foreign exchange rates, we have established transaction-based hedging programs. Our hedging programs reduce, but do not always eliminate, the impact of foreign currency exchange rate movements. At any point in time, we may have outstanding contracts with several major financial institutions for these hedging transactions. Our maximum credit risk loss with these institutions is limited to any gain on our outstanding contracts. As of December 31, 2012 and December 31, 2011, these currency forward contracts had net notional amounts of $320.5 million and $293.2 million, respectively.

In addition to the currency forward contracts purchased to hedge transactional currency risks, we entered into currency forward contracts during 2010 to hedge cash flow risks associated with future purchases of raw materials denominated in Euros. These forward contracts were established as cash flow hedges designed to protect against the variability in foreign currency rates between the Euro and U.S. Dollar. The cash flow hedges were accounted for using hedge accounting. As of June 30, 2011, the future purchases of raw materials associated with these cash flow hedges were no longer deemed probable and accordingly, the related gains of $14.2 million on the forward contracts were reclassified from accumulated other comprehensive (loss) income into earnings. During the 2011 third quarter, these forward contracts were liquidated, resulting in a loss of $6.6 million. There were no outstanding currency forward contracts designated as cash flow hedges as of December 31, 2012 and 2011.

We are party to three interest rate swap instruments that are accounted for using hedge accounting. These instruments are used to hedge floating rate debt and are accounted for as cash flow hedges. Under the swap agreements, we pay the fixed rate and the financial institution counterparties to the agreements pay MEMC a floating interest rate as indicated in the table below. The amount recorded in the consolidated balance sheet as provided in the table below represents the estimated fair value of the net amount that we would settle on December 31, 2012, if the agreements were transferred to other third parties or cancelled by us. The effective portion of these hedges for the year ended December 31, 2012 and 2011 were losses of $5.0 million and $4.5 million, respectively, and a gain of $5.3 million for the year ended December 31, 2010, which were recorded to other comprehensive (loss) income. There was no material ineffectiveness for the years ended December 31, 2012, December 31, 2011, and December 31, 2010, respectively.

As of December 31, 2012, we have one interest rate swap instrument that is used as an economic hedge. This instrument is used to hedge floating rate debt and is not accounted for as a cash flow hedge. Under the swap agreement, we pay the fixed rate and the financial institution counterparty to the agreement pays us a floating interest rate based on the table below. The amount recorded in the consolidated balance sheet as provided in the table below represents the estimated fair value of the net amount that we would settle on December 31, 2012 if the agreements were transferred to other third parties or cancelled by us. Because this hedge is deemed an economic hedge and not accounted for under hedge accounting, the changes in fair value are recorded to non-operating expense (income) within the consolidated statement of operations. The fair value of these hedges as of December 31, 2011 was a liability of $1.1 million. No such hedges existed prior to 2011.

A summary of all interest rate swap instruments as of December 31, 2012 are as follows:

	Notional Amount (in millions)	Fixed Rate	Variable Rate	Termination Date	Assets (Liabilities) Fair Value at December 31, 2012
					Dollars in millions
Interest rate swap #1 cash flow hedge	4.4 Euros	5.1%	Euribor plus 1.5%	6/30/2023	$	(1.7	)
Interest rate swap #2 cash flow hedge	1.8 Euros	5.1%	Euribor plus 1.5%	6/30/2023	(0.7		)
Interest rate swap #3 cash flow hedge	32.4 Canadian Dollars	3.3%	Canadian Deposit Offering Rate	6/5/2028	(2.6		)
Interest rate swap #4 economic hedge	11.5 South African Rand	5.25%	ZAR-JIBAR-SAFEX Rate	3/31/2024	—
					$	(5.0	)

We previously had an unconsolidated joint venture, Q-Cells SE, which was a Euro functional currency entity accounted for under the equity method, in which we invested 72.5 million Euros (approximately $105 million) in 2009. In order to manage the changes in foreign currency and any resulting gain or loss associated with this investment, we entered into a Euro currency forward contract, accounted for as a net investment hedge, for 70.0 million Euros. We received 63.5 million Euros (approximately $77 million) of our investment in the second quarter of 2010 and at the same time reduced our net investment hedge to the remaining equity investment balance. During the fourth quarter of 2010, we received the remaining balance of our investment of 5.8 million Euros (approximately $8 million). During 2010, we recognized a gain of $17.3 million on this hedge and at the same time recognized a foreign currency loss on our investment of $14.3 million. Both amounts were recorded in other, net in our statement of operations. No ineffectiveness was recognized in 2012, 2011 or 2010.

The Suntech warrant consists of a fully vested, non-forfeitable warrant to purchase common shares of Suntech which was received in 2006 at the time that we signed a long-term supply agreement with Suntech. The long-term supply agreement was terminated in the second quarter of 2011, but the termination had no impact on the warrant. The Suntech warrant exposes us to equity price risk.

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Inventories

12 Months Ended

Dec. 31, 2012

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

Inventories consist of the following:

	As of December 31,
	2012		2011
In millions
Raw materials and supplies	$	89.1	$	121.6
Goods and work-in-process	109.1		97.7
Finished goods	49.6		102.5
Total inventories	$	247.8	$	321.8

In connection with our 2011 Global Plan, we have realigned our operations such that we are primarily manufacturing solar wafers and sourcing solar cells and modules for internal consumption by SunEdison. As a result, effective January 1, 2012, all solar wafer, cell and module inventory is classified as goods and work in process. Finished goods inventory at December 31, 2011 in the above table includes $42.8 million of solar wafer inventory classified as finished goods.

SunEdison inventories of $27.3 million at December 31, 2012 and $58.4 million at December 31, 2011 consist of raw materials and supplies not allocated to a solar energy system. Included in the table above at December 31, 2012, we had $27.7 million of finished goods inventory held on consignment, compared to $28.5 million at December 31, 2011.

During the year ended December 31, 2012, we recorded lower of cost or market charges totaling $3.4 million to work in process and raw materials inventory, primarily related to adverse solar market pricing conditions.

Due to adverse solar market conditions and related price decreases, which led to the reduction of solar wafer production at our Kuching, Malaysia and Portland, Oregon plants and the shuttering of our Merano, Italy plant, we recorded lower of cost or market charges on our raw materials and supplies inventory of $53.7 million, in the year ended December 31, 2011. No such charges were recorded in the year ended December 31, 2010. In addition to the raw materials and supplies inventory charges, we recorded charges of approximately $30.2 million, and $0.4 million, respectively, for goods and work-in-process in the years ended December 31, 2011 and December 31, 2010. Further, we recorded charges for finished goods inventory primarily related to the adverse solar market conditions which led to underutilization of our Kuching solar wafering plant in the amount of $29.7 million and $2.1 million, respectively, for the years ended December 31, 2011 and December 31, 2010.

Due to the earthquake in Japan on March 11, 2011, wafer production in our semiconductor wafer plant in Japan was suspended from that time through April 12, 2011. Due to the unplanned downtime, we recorded a total of $14.9 million of adjustments during the year ended December 31, 2011 as period charges to cost of goods sold for the under absorption of production costs. We recorded no similar adjustments for the years ended December 31, 2012 and December 31, 2010.

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Derivatives and Hedging Instruments (Interest Rate Swap Instruments) (Details) In Millions, unless otherwise specified	Dec. 31, 2012 Interest Rate Swap One [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap One [Member] EUR (€)	Dec. 31, 2012 Interest Rate Swap Two [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap Two [Member] EUR (€)	Dec. 31, 2012 Interest Rate Swap Three [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap Three [Member] CAD	Dec. 31, 2012 Interest Rate Swap Four [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap Four [Member] THB
Derivative [Line Items]
Notional Amount of Interest Rate Cash Flow Hedge Derivatives		€ 4.4		€ 1.8		32.4		11.5
Derivative, Fixed Interest Rate	5.10%	5.10%	5.10%	5.10%	3.30%	3.30%	5.25%	5.25%
Derivative, Basis Spread on Variable Rate	1.50%	1.50%	1.50%	1.50%
Interest Rate Cash Flow Hedge Derivative at Fair Value, Net	$ (1.7)		$ (0.7)		$ (2.6)		$ 0

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Stockholders' Equity Stockholders' Equity (Stock-Based Compensation Expense Allocation) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based employee compensation before related tax effects	$ 31.4	$ 43.4	$ 51.2
Cost of Goods Sold [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based employee compensation before related tax effects	5.9	5.9	5.7
Marketing and Administration [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based employee compensation before related tax effects	21.7	32.5	40.8
Research and Development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based employee compensation before related tax effects	$ 3.8	$ 5.0	$ 4.7

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Investments (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended				3 Months Ended	1 Months Ended	12 Months Ended	16 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Joint Venture [Member]	Dec. 31, 2011 Meike Joint Venture [Member]	Sep. 30, 2011 SMP JV [Member]	Dec. 31, 2012 SMP JV [Member]	Dec. 31, 2012 SMP JV [Member]	Dec. 31, 2012 SMP JV [Member] Samsung Fine Chemicals Joint Venture [Member]	Dec. 31, 2012 SMP JV [Member] MEMC Singapore Pte Ltd [Member]
Schedule of Equity Method Investments [Line Items]
Equity contribution in joint venture		$ 47.8	$ 50.4	$ 18.8	$ 43.4				$ 57.3
Customer and other deposits	276.8	184.5	276.8					30.5	30.5
Total remaining contractual investment commitment in joint venture		117.7
Expected Contractual Investment Payments In One Year					105.0
Equity Method Investment, Other than Temporary Impairment						67.3
Assets impairment charges	365.4	20.0	381.7	0
Equity method investments	25.8	23.3	25.8					0	0
Ownership interest in joint venture										50.00%	50.00%
Debt and equity commitments in joint venture								175.0
Period Of Unbilled Contracts Receivable Expected To Be Collected							24 months
Cost-method Investments, Other than Temporary Impairment		3.6	11.6
Available-for-sale Equity Securities, Amortized Cost Basis		$ 12.4

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Reportable Segments (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		12 Months Ended			3 Months Ended		12 Months Ended			3 Months Ended	12 Months Ended					3 Months Ended			12 Months Ended			3 Months Ended	12 Months Ended	3 Months Ended		12 Months Ended		0 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011 Semiconductor Materials [Member]	Dec. 31, 2011 Solar Energy [Member]	Dec. 31, 2012 Solar Energy [Member]	Dec. 31, 2011 Solar Energy [Member]	Dec. 31, 2010 Solar Energy [Member]	Dec. 31, 2011 Corporate and Other [Member]	Dec. 31, 2012 Corporate and Other [Member]	Dec. 31, 2012 Inventories [Member]	Dec. 31, 2011 Inventories [Member]	Dec. 31, 2010 Inventories [Member]	Dec. 31, 2011 Kuching Solar Wafering Plant [Member] Solar Energy [Member]	Dec. 31, 2012 Solar Wafer Supply Agreement [Member]	Sep. 30, 2011 Solar Wafer Supply Agreement [Member]	Jun. 30, 2011 Solar Wafer Supply Agreement [Member]	Dec. 31, 2012 Solar Wafer Supply Agreement [Member]	Mar. 31, 2012 Solar Wafer Supply Agreement [Member]	Dec. 31, 2011 Solar Wafer Supply Agreement [Member]	Jun. 30, 2011 Hurricane [Member]	Dec. 31, 2012 Hurricane [Member]	Jun. 30, 2011 Hurricane [Member] Semiconductor Materials [Member]	Jun. 30, 2011 Hurricane [Member] Solar Energy [Member]	Dec. 31, 2012 Earthquake [Member] Semiconductor Materials [Member]	Dec. 31, 2011 Earthquake [Member] Semiconductor Materials [Member]	Sep. 04, 2012 2011 Global Plan [Member] Purchase Obligation Termination [Member]
Segment Reporting Information [Line Items]
Charges related to low volumes at solar wafering plant																$ 0											$ 27.2
Inventory Write-down		96.7	3.4	107.0		14.2	82.5				0																15.8	0
Deferred Revenue	288.3	250.7	288.3	250.7			198.8	259.1	198.8								175.7			175.7	0.7	176.4
Restructuring Reserve, Accrual Adjustment																													(69.2)
Gain on Receipt of Property Plant and Equipment			31.7	0	0
Deferred revenue recognized	54.4		(73.8)	(67.9)	(13.1)			0.9									(6.9)	(19.4)	(149.4)
Cost of Goods Sold			2,194.3	2,420.6	1,902.1								5.5	37.4	5.7
Goodwill impairment charges		384.1	0	440.5	0	0	384.1	440.5	440.5	0	0
Goodwill		0		0	342.7		0		0	342.7
Net insurance proceeds from our business interruption lost profits claim related to the disruption			4.0	4.0	11.9																		11.9	0	8.0	3.9	4.0	4.0
Legal expenses												$ 8.6

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Derivatives and Hedging Instruments (Narrative) (Details) In Millions, unless otherwise specified	12 Months Ended			3 Months Ended	6 Months Ended	3 Months Ended				12 Months Ended
	Dec. 31, 2012 USD ($) instrument	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Sep. 30, 2011 Other Income [Member] USD ($)	Dec. 31, 2011 Other Income [Member] USD ($)	Dec. 31, 2011 Q-Cells SE [Member] USD ($)	Dec. 31, 2011 Q-Cells SE [Member] EUR (€)	Jun. 30, 2011 Q-Cells SE [Member] USD ($)	Jun. 30, 2011 Q-Cells SE [Member] EUR (€)	Dec. 31, 2011 Q-Cells SE [Member] USD ($)	Dec. 31, 2010 Q-Cells SE [Member] USD ($)	Dec. 31, 2010 Q-Cells SE [Member] EUR (€)	Dec. 31, 2011 Q-Cells SE [Member] Other Income [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap Cash Flow Hedge [Member] USD ($) instrument	Dec. 31, 2011 Interest Rate Swap Cash Flow Hedge [Member] USD ($)	Dec. 31, 2010 Interest Rate Swap Cash Flow Hedge [Member] USD ($)	Dec. 31, 2012 Interest Rate Swap Economic Hedge [Member] USD ($) instrument
Derivatives, Fair Value [Line Items]
Currency forward contracts, net notional amounts	$ 320.5	$ 293.2
Gain reclassified from Accumulated Other Comprehensive Income into earnings for currency forward contracts					14.2
Gain (Loss) on Foreign Currency Derivatives Recorded in Earnings, Net				6.6
Notional Amount of Foreign Currency Cash Flow Hedge Derivatives												70.0
Gain (Loss) on Foreign Currency Cash Flow Hedge Ineffectiveness										0	0
Number of Interest Rate Derivatives Held	4													3			0
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Net of Tax														(5.0)	(4.5)	5.3
Interest Rate Cash Flow Hedge Liability at Fair Value																	1.1
Payments to Acquire Equity Method Investments	47.8	50.4	18.8								105.0	72.5
Proceeds from return of equity method investment	5.8	95.7	85.3			8.0	5.8	77.0	63.5
Gain on Discontinuation of Cash Flow Hedge Due to Forecasted Transaction Probable of Not Occurring													17.3
Equity in (loss) earnings of joint ventures, net of tax	$ (2.3)	$ (62.8)	$ 7.2							$ 14.3

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Employee Related Liabilities (Pension Benefit Plan Assets) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
2011 Target Allocation, Cash	0.00%
Actual Allocation	100.00%	100.00%
Fair Value	$ 168.5	$ 171.6
2011 Target Allocation, Equity Securities	60.00%
2011 Target Allocation, Fixed Income Securities	40.00%
2011 Target Allocation, Total	100.00%
Cash [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Actual Allocation	32.00%	15.00%
Fair Value	53.7	24.8
Equity Securities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Actual Allocation	55.00%	61.00%
Fair Value	92.9	105.2
US Large Cap [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	38.5	50.9
Mid Cap [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	11.1	11.9
Small Cap [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	11.0	11.3
International [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	22.0	21.3
Emerging Markets [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	10.3	9.8
Fixed Income Securities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Actual Allocation	13.00%	24.00%
Fair Value	21.9	41.6
Investment Grade Bonds [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	8.3	15.8
Corporate Bond Securities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value	$ 13.6	$ 25.8

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Acquisitions (Tables)

12 Months Ended

Dec. 31, 2012

Solaicx [Member]

Business Acquisition [Line Items]

Schedule of Purchase Price Allocation

The table below represents the allocation of the total consideration to tangible and intangible assets acquired and liabilities assumed from Solaicx based on an estimate of the fair value at the acquisition date:

In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	2.2
Other current assets	11.6
Property, plant and equipment, net	30.0
Goodwill	56.4
Intangible assets	21.0
Other noncurrent assets	0.4
Current liabilities	(12.2		)
Long-term debt and capital lease obligations, excluding current portion	(1.3		)
Other long-term liabilities	(6.4		)
Total purchase price	$	101.7

Schedule of Purchase Price Calculation

The purchase price was calculated as follows:

In Millions
Cash	$	75.7
Contingent consideration	26.0
Total purchase price including estimated contingent consideration	$	101.7

FRV US [Member]

Business Acquisition [Line Items]

Schedule of Purchase Price Allocation

The table below represents the allocation of the total consideration of tangible and intangible assets acquired and liabilities assumed from FRV U.S. based on an estimate of the fair value at the acquisition date:

In Millions
Allocation of the purchase price:
Cash and cash equivalents	$	1.8
Solar energy systems held for development	64.2
Other current assets	9.0
Property, plant and equipment, net	23.0
Goodwill	44.6
Intangible assets	115.5
Other noncurrent assets	50.2
Current liabilities	(3.4		)
Short-term debt	(32.9		)
Other long-term liabilities	(44.6		)
Noncontrolling interests	(39.6		)
Total purchase price	$	187.8

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Condensed Consolidating Financial Information (Tables)

12 Months Ended

Dec. 31, 2012

Condensed Consolidating Financial Information [Abstract]

Schedule of Condensed Consolidating Statement of Operations

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	720.9		$	1,037.5		$	3,035.8		$	(2,264.3	)	$	2,529.9
Cost of goods sold	807.7			987.9			2,606.1			(2,207.4		)	2,194.3
Gross margin	(86.8		)	49.6			429.7			(56.9		)	335.6
Operating expenses:
Marketing and administration	112.4			81.1			112.7			—			306.2
Research and development	49.5			13.8			8.5			—			71.8
Gain on receipt of property, plant and equipment	—			—			(31.7		)	—			(31.7		)
Restructuring (reversals) charges	(2.9		)	2.5			(83.1		)	—			(83.5		)
Long-lived asset impairment charges	18.9			0.7			—			—			19.6
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating (loss) income	(264.7		)	(48.5		)	427.3			(56.9		)	57.2
Non-operating (income) expense:
Interest expense	54.6			6.8			73.9			—			135.3
Interest income	(0.1		)	(0.5		)	(3.0		)	—			(3.6		)
Decline in fair value of warrant	—			—			0.2			—			0.2
Other, net	(58.4		)	(5.9		)	62.7			8.4			6.8
Total non-operating (income) expense	(3.9		)	0.4			133.8			8.4			138.7
(Loss) income before income taxes, investment in subsidiary income (loss) and equity in loss of joint ventures	(260.8		)	(48.9		)	293.5			(65.3		)	(81.5		)
Income tax (benefit) expense	(59.6		)	91.9			57.6			(25.0		)	64.9
(Loss) income before investment in subsidiary income (loss) and equity in loss of joint ventures	(201.2		)	(140.8		)	235.9			(40.3		)	(146.4		)
Investment in subsidiary income (loss)	50.6			(1.5		)	—			(49.1		)	—
Equity in loss of joint ventures, net of tax	—			—			(2.3		)	—			(2.3		)
Net (loss) income	(150.6		)	(142.3		)	233.6			(89.4		)	(148.7		)
Net income attributable to noncontrolling interests	—			(0.7		)	(1.2		)	—			(1.9		)
Net (loss) income attributable to MEMC stockholders	$	(150.6	)	$	(143.0	)	$	232.4		$	(89.4	)	$	(150.6	)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	872.7		$	971.9		$	3,692.8		$	(2,821.9	)	$	2,715.5
Cost of goods sold	914.2			884.5			3,312.0			(2,690.1		)	2,420.6
Gross profit	(41.5		)	87.4			380.8			(131.8		)	294.9
Operating expenses:
Marketing and administration	138.3			78.8			135.7			—			352.8
Research and development	60.9			10.7			15.9			—			87.5
Goodwill impairment charges	—			430.8			9.7			—			440.5
Restructuring charges	8.2			6.7			335.8			—			350.7
Long-lived asset impairment	19.4			42.8			305.7			—			367.9
Insurance recovery	—			—			(4.0		)	—			(4.0		)
Operating loss	(268.3		)	(482.4		)	(418.0		)	(131.8		)	(1,300.5		)
Non-operating (income) expense:
Interest expense	35.4			7.7			34.1			—			77.2
Interest income	(0.3		)	(0.4		)	(3.8		)	—			(4.5		)
Decline in fair value of warrant	—			—			4.8			—			4.8
Other, net	(142.3		)	(2.4		)	124.2			26.6			6.1
Total non-operating (income) expense	(107.2		)	4.9			159.3			26.6			83.6
Loss before income taxes, investment in subsidiary loss and equity in earnings (loss) of joint ventures	(161.1		)	(487.3		)	(577.3		)	(158.4		)	(1,384.1		)
Income tax expense	16.3			31.0			29.5			(3.7		)	73.1
(Loss) income before investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(177.4		)	(518.3		)	(606.8		)	(154.7		)	(1,457.2		)
Investment in subsidiary loss	(1,358.6		)	(1,046.2		)	—			2,404.8			—
Equity in earnings (loss) of joint ventures, net of tax	—			0.2			(63.0		)	—			(62.8		)
Net loss	(1,536.0		)	(1,564.3		)	(669.8		)	2,250.1			(1,520.0		)
Net income attributable to noncontrolling interests	—			(0.5		)	(15.5		)	—			(16.0		)
Net loss attributable to MEMC stockholders	$	(1,536.0	)	$	(1,564.8	)	$	(685.3	)	$	2,250.1		$	(1,536.0	)

Condensed Consolidating Statement of Operations

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Net sales	$	829.1		$	468.3		$	2,478.5		$	(1,536.7	)	$	2,239.2
Cost of goods sold	823.3			457.3			2,158.7			(1,537.2		)	1,902.1
Gross profit	5.8			11.0			319.8			0.5			337.1
Operating expenses:
Marketing and administration	122.0			61.2			83.8			—			267.0
Research and development	38.5			6.6			10.5			—			55.6
Restructuring charges	5.3			—			—			—			5.3
Insurance Recovery	—			(11.9		)	—			—			(11.9		)
Operating (loss) income	(160.0		)	(44.9		)	225.5			0.5			21.1
Non-operating (income) expense:
Interest expense	(1.7		)	3.2			30.9			(3.4		)	29.0
Interest income	(0.2		)	(2.7		)	(6.0		)	3.4			(5.5		)
Increase in fair value of warrant	—			—			14.0			—			14.0
Other, net	(44.5		)	1.2			23.4			16.0			(3.9		)
Total non-operating (income) expense	(46.4		)	1.7			62.3			16.0			33.6
(Loss) income before income taxes, investment in subsidiary earnings (loss) and equity in (loss) earnings of joint ventures	(113.6		)	(46.6		)	163.2			(15.5		)	(12.5		)
Income tax (benefit) expense	(64.6		)	(17.9		)	30.8			(1.6		)	(53.3		)
(Loss) income before investment in subsidiary earnings and equity in loss of joint ventures	(49.0		)	(28.7		)	132.4			(13.9		)	40.8
Investment in subsidiary earnings (loss)	84.9			(14.2		)	—			(70.7		)	—
Equity in (loss) earnings of joint ventures, net of tax	(1.5		)	—			8.7			—			7.2
Net income (loss)	34.4			(42.9		)	141.1			(84.6		)	48.0
Net loss (income) attributable to noncontrolling interests	—			0.3			(13.9		)	—			(13.6		)
Net income (loss) attributable to MEMC stockholders	$	34.4		$	(42.6	)	$	127.2		$	(84.6	)	$	34.4

Schedule of Condensed Consolidating Balance Sheet

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
ASSETS
Current assets:
Cash and cash equivalents	$	65.1	$	60.0	$	447.5	$	—		$	572.6
Restricted cash	—		—		72.4		—			72.4
Accounts receivable, net	62.0		23.7		134.7		—			220.4
Inventories	18.4		70.6		200.0		(41.2		)	247.8
Solar energy systems held for development and sale	—		0.3		213.7		(80.2		)	133.8
Prepaid and other current assets	24.9		40.1		147.2		—			212.2
Total current assets	170.4		194.7		1,215.5		(121.4		)	1,459.2
Investments	7.3		20.4		21.9		—			49.6
Investments in subsidiaries	498.2		564.2		—		(1,062.4		)	—
Property, plant and equipment, net:
Non solar energy systems	57.2		294.4		913.8		(52.3		)	1,213.1
Solar energy systems	—		3.0		1,361.3		95.6			1,459.9
Deferred tax assets, net	—		—		—		—			—
Restricted cash	—		1.7		48.5		—			50.2
Other assets	29.4		44.0		282.0		—			355.4
Intangible assets, net	—		110.9		3.3		—			114.2
Total assets	$	762.5	$	1,233.3	$	3,846.3	$	(1,140.5	)	$	4,701.6

Condensed Consolidating Balance Sheet

December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.4		$	—		$	3.4
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	—			0.2			97.6			—			97.8
Accounts payable	11.9			67.0			398.1			—			477.0
Accrued liabilities	32.8			42.5			268.9			—			344.2
Deferred revenue for solar energy systems	—			40.7			72.4			—			113.1
Contingent consideration related to acquisitions	—			23.1			—			—			23.1
Customer and other deposits	10.9			0.4			65.9			—			77.2
Intercompany (receivable) payable and short term notes	(651.0		)	764.3			(113.3		)	—			—
Total current liabilities	(595.4		)	938.2			793.0			—			1,135.8
Long-term debt and capital lease obligations, less current portion	746.1			—			12.6			—			758.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	—			9.8			1,498.6			—			1,508.4
Pension and post-employment liabilities	23.9			—			28.8			—			52.7
Customer and other deposits	87.8			—			96.7			—			184.5
Deferred revenue for solar energy systems	—			45.8			100.2			—			146.0
Deferred revenue for non solar energy systems	—			—			29.2			—			29.2
Long-term intercompany note (receivable) payable	(45.4		)	(96.2		)	141.6			—			—
Other liabilities	(29.8		)	112.0			126.7			—			208.9
Total liabilities	187.2			1,009.6			2,827.4			—			4,024.2
Redeemable noncontrolling interest	—			—			11.3			—			11.3
Total MEMC stockholders’ equity	575.3			223.7			916.8			(1,140.5		)	575.3
Noncontrolling interests	—			—			90.8			—			90.8
Total stockholders’ equity	575.3			223.7			1,007.6			(1,140.5		)	666.1
Total liabilities and stockholders’ equity	$	762.5		$	1,233.3		$	3,846.3		$	(1,140.5	)	$	4,701.6

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	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	72.3		315.5			916.4		(50.5		)	1,253.7
Solar energy systems	—		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
Goodwill	—		—			—		—			—
Intangible assets, net	—		145.2			4.0		—			149.2
Total assets	$	769.0	$	671.1		$	3,726.9	$	(285.4	)	$	4,881.6

Condensed Consolidating Balance Sheet

December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations	$	—		$	—		$	3.7		$	—		$	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback 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 and capital lease obligations, less current portion	550.0			—			17.7			—			567.7
Long-term solar energy system debt, financings and capital leaseback 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
Deferred revenue for non solar energy systems	—			—			51.2			—			51.2
Long-term intercompany note (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

Condensed Consolidating Statement of Cash Flows

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2012

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(213.7	)	$	9.4		$	(7.3	)	$	(51.9	)	$	(263.5	)
Cash flows from investing activities:
Capital expenditures	(18.0		)	(19.5		)	(101.5		)	—			(139.0		)
Construction of solar energy systems	—			—			(387.8		)	40.9			(346.9		)
Purchases of cost and equity method investments	(8.2		)	—			(39.6		)	—			(47.8		)
Proceeds from return of (payments to) equity method investments	10.0			—			(4.2		)	—			5.8
Change in restricted cash	—			(1.5		)	8.2			—			6.7
Equity infusions or investments in subsidiaries	(44.0		)	(6.7		)	50.7			—			—
Other	2.0			0.1			(4.4		)	11.0			8.7
Net cash used in investing activities	(58.2		)	(27.6		)	(478.6		)	51.9			(512.5		)
Cash flows from financing activities:
Proceeds from long-term debt	196.0			—			—			—			196.0
Cash paid for contingent consideration	—			(15.1		)	(54.1		)	—			(69.2		)
Proceeds from solar energy system financing and capital lease obligations	—			8.4			895.8			—			904.2
Repayments of solar energy system financing and capital lease obligations	—			(0.5		)	(245.7		)	—			(246.2		)
Net repayments of customer deposits related to long-term supply agreements	—			—			(24.4		)	—			(24.4		)
Principal payments on long-term debt	—			—			(3.6		)	—			(3.6		)
Common stock repurchases	(0.5		)	—			—			—			(0.5		)
Receipts from noncontrolling interest	—			—			50.8			—			50.8
(Repayment of) collection of intercompany debt	(74.4		)	27.1			47.3			—			—
Debt financing fees	(12.7		)	—			(29.6		)	—			(42.3		)
Net cash provided by financing activities	108.4			19.9			636.5			—			764.8
Effect of exchange rate changes on cash and cash equivalents	(0.3		)	—			(1.7		)	—			(2.0		)
Net (decrease) increase in cash and cash equivalents	(163.8		)	1.7			148.9			—			(13.2		)
Cash and cash equivalents at beginning of period	228.9			58.3			298.6			—			585.8
Cash and cash equivalents at end of period	$	65.1		$	60.0		$	447.5		$	—		$	572.6

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2011

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(216.5	)	$	66.3		$	193.0		$	(58.1	)	$	(15.3	)
Cash flows from investing activities:
Capital expenditures	(24.1		)	(56.4		)	(372.0		)	—			(452.5		)
Construction of solar energy systems	—			—			(627.5		)	29.4			(598.1		)
Purchases of cost and equity method investments	(1.1		)	(5.0		)	(44.3		)	—			(50.4		)
Proceeds from return of equity method investments	82.0			13.7			—			—			95.7
Change in restricted cash	—			0.5			(124.3		)	—			(123.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			(14.4		)	(0.1		)	—			(14.5		)
Proceeds from Property, Plant and Equipment	—			—			43.9			—			43.9
Cash payments for acquisition, net of cash acquired	—			(160.1		)	(3.9		)	—			(164.0		)
Equity infusions or investments in subsidiaries	82.9			2.8			(85.7		)	—			—
Other	5.7			(0.1		)	(33.5		)	28.7			0.8
Net cash provided by (used in) investing activities	145.4			(219.0		)	(1,247.4		)	58.1			(1,262.9		)
Cash flows from financing activities:
Proceeds from long-term debt	550.0			—			—			—			550.0
Proceeds from solar energy system financing and capital lease obligations	—			0.5			1,070.7			—			1,071.2
Cash paid for contingent consideration	—			(50.2		)	—			—			(50.2		)
Repayments of solar energy system financing and capital lease obligations	—			(1.8		)	(264.7		)	—			(266.5		)
Net repayments of customer deposits related to long-term supply agreements	—			(1.8		)	(55.9		)	—			(57.7		)
(Repayment of) collections on intercompany debt	(243.7		)	257.2			(13.5		)	—			—
Principal payments on long-term debt	—			—			(3.7		)	—			(3.7		)
Purchases of and dividends to noncontrolling interest	—			—			(49.0		)	—			(49.0		)
Common stock repurchases	(3.6		)	—			—			—			(3.6		)
Debt financing fees	(18.0		)	—			(21.8		)	—			(39.8		)
Net cash provided by financing activities	284.7			203.9			662.1			—			1,150.7
Effect of exchange rate changes on cash and cash equivalents	(0.2		)	(0.1		)	6.3			—			6.0
Net increase (decrease) in cash and cash equivalents	213.4			51.1			(386.0		)	—			(121.5		)
Cash and cash equivalents at beginning of period	15.5			7.2			684.6			—			707.3
Cash and cash equivalents at end of period	$	228.9		$	58.3		$	298.6		$	—		$	585.8

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2010

(In millions)

	MEMC, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(128.4	)	$	65.0		$	318.5		$	92.5		$	347.6
Cash flows from investing activities:
Capital expenditures	(25.1		)	(45.7		)	(281.2		)	—			(352.0		)
Construction of solar energy systems	—			(1.4		)	(171.9		)	(106.8		)	(280.1		)
Proceeds from sale and maturities of investments	—			—			185.0			—			185.0
Purchases of cost and equity method investments	—			(10.4		)	(8.4		)	—			(18.8		)
Proceeds from return of equity method investments	85.3			—			—			—			85.3
Change in restricted cash	—			0.3			(2.1		)	—			(1.8		)
Payments to vendors for refundable deposits on long-term agreements and loans	—			—			(85.0		)	—			(85.0		)
Cash payments for acquisition, net of cash acquired	(75.7		)	2.2			—			—			(73.5		)
Equity infusions or investments in subsidiaries	(30.2		)	1.8			28.4			—			—
Other	30.7			2.9			(28.8		)	14.3			19.1
Net cash used in investing activities	(15.0		)	(50.3		)	(364.0		)	(92.5		)	(521.8		)
Cash flows from financing activities:
Proceeds from solar energy system financing and capital lease obligations	—			1.8			362.6			—			364.4
Repayments of solar energy system financing and capital lease obligations	—			(1.9		)	(59.2		)	—			(61.1		)
Net repayments of customer deposits related to long-term supply agreements	—			(0.4		)	(30.9		)	—			(31.3		)
Collections on (repayment of) intercompany debt	55.9			(55.9		)	—			—			—
Principal payments on long-term debt	—			—			(4.8		)	—			(4.8		)
Purchases of and dividends to noncontrolling interest	—			(0.8		)	(7.5		)	—			(8.3		)
Common stock repurchases	(2.9		)	—			—			—			(2.9		)
Debt financing fees	—			—			(12.8		)	—			(12.8		)
Net cash provided by (used in) financing activities	53.0			(57.2		)	247.4			—			243.2
Effect of exchange rate changes on cash and cash equivalents	—			—			5.6			—			5.6
Net (decrease) increase in cash and cash equivalents	(90.4		)	(42.5		)	207.5			—			74.6
Cash and cash equivalents at beginning of period	105.9			49.7			477.1			—			632.7
Cash and cash equivalents at end of period	$	15.5		$	7.2		$	684.6		$	—		$	707.3

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Stockholders' Equity

12 Months Ended

Dec. 31, 2012

Stockholders' Equity Note [Abstract]

STOCKHOLDERS’ EQUITY

STOCKHOLDERS’ EQUITY

Preferred Stock

We have 50.0 million authorized shares of $.01 par value preferred stock and no preferred shares issued and outstanding as of December 31, 2012 and 2011. The Board of Directors is authorized, without further action by the stockholders, to issue any or all of the preferred stock.

Common Stock

Holders of our $.01 par value common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders. Subject to the rights of any holders of preferred stock, holders of common stock are entitled to receive ratably such dividends as may be declared by the Board of Directors. In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to share ratably in the distribution of all assets remaining after payment of liabilities, subject to the rights of any holders of preferred stock. The declaration and payment of future dividends on our common stock, if any, will be at the sole discretion of the Board of Directors and is subject to restrictions as contained in the amended and restated credit facility (see Note 11). There were no dividends declared or paid during the years ended December 31, 2012, 2011 and 2010.

On November 20, 2009, we completed the acquisition of SunEdison by paying a portion of the consideration in 3.8 million shares of MEMC common stock with an acquisition date fair value of $45.8 million and providing contingent consideration. The value of the shares was based upon the closing price of MEMC’s common stock at the date of acquisition, or $12.08. On February 1, 2011, MEMC issued 2.1 million shares of MEMC common stock in connection with the SunEdison contingent consideration payout.

Our Board of Directors has approved a $1.0 billion stock repurchase program. The stock repurchase program allows MEMC to purchase common stock from time to time on the open market or through privately negotiated transactions using available cash. The specific timing and amount of repurchases will vary based on market conditions and other factors and may be modified, extended or terminated by the Board of Directors at any time. No shares were repurchased in 2012, 2011, or 2010 under the stock repurchase program. From inception through December 31, 2012, we have repurchased 9.0 million shares at a total cost of $448.0 million.

Redeemable Noncontrolling Interest

On June 27, 2012, we issued redeemable common stock in certain consolidated subsidiaries to a non affiliated third party representing a 15% noncontrolling interest in those consolidated subsidiaries. We received cash proceeds of $11.4 million in 2012 as consideration for the redeemable stock issuance, which was initially measured and reported net of stock issuance costs of $1.4 million in the temporary equity section on the consolidated balance sheet as Redeemable Noncontrolling Interest. Under the terms of the arrangement, the noncontrolling interest holder has an option to make additional investments up to an aggregate of approximately $55 million. The noncontrolling interest holder also has a contingent right to require us to repurchase the holder's 15% interest at a redemption price that does not represent fair value. The noncontrolling interest becomes redeemable at the earlier of (i) April 15, 2019 or (ii) the occurrence of certain contingent events, including those that are not solely within the control of the company. Accordingly, we have adjusted the redeemable noncontrolling interest to its expected redemption value, resulting in a $1.6 million reduction to retained earnings as of December 31, 2012.

Stock-Based Compensation

We have equity incentive plans that provide for the award of non-qualified stock options, restricted stock, performance shares, and restricted stock units to employees, non-employee directors and consultants. We issue new shares to satisfy stock option exercises. As of December 31, 2012, there were 5.1 million shares authorized for future grant under these plans. Options to employees are generally granted upon hire and annually or semi-annually, usually with four-year ratable vesting, although certain grants have three, four or five-year cliff vesting. No option has a term of more than 10 years. The exercise price of stock options granted has historically equaled the market price on the date of the grant.

The following table presents information regarding outstanding stock options as of December 31, 2012 and changes during the year then ended with regard to stock options:

	Shares		Weighted- Average Exercise Price		Aggregate Intrinsic Value (in millions)		Weighted- Average Remaining Contractual Life
Beginning of year	17,066,401		$	19.21
Granted *	16,119,890		2.82
Exercised	—		—
Forfeited	(6,090,871	)	11.59
Expired	(5,684,301	)	30.20
End of year	21,411,119		$	6.12	$	7.7	8
Options exercisable at year-end	2,940,515		$	17.50	$	7.5	6

* Included in the 16,119,890 options granted in 2012 is the 9.4 million market based awards issued to select employees, including senior executives, excluding the chief executive officer.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between our closing stock price on the last trading day of 2012 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2012. This amount changes based on the fair market value of our stock. There were no material amounts of option exercises and related cash receipts or tax benefits realized for 2012, 2011 or 2010.

At our May 25, 2012 annual meeting of stockholders, stockholders approved amendments to our equity incentive plans to permit a one-time stock option exchange program pursuant to which certain employees, excluding directors and executive officers, would be permitted to surrender for cancellation certain outstanding stock options with an exercise price substantially greater than our then current trading price in exchange for fewer stock options at a lower exercise price. The option exchange program commenced on July 17, 2012 and closed on August 17, 2012. The number of new stock options replacing surrendered eligible options was determined by an exchange ratio dependent on the exercise price of the original options and constructed to result in the new option value being approximately equal to the value of surrendered options. The program was designed to cause us to incur minimal incremental stock-based compensation expense in future periods. The option exchange resulted in the cancellation of 6.9 million old options and the issuance of 2.0 million new options with an award date of August 20, 2012 and a new exercise price of $2.77 per share. The cancelled options are reflected in the rollforward above as either forfeited or expired, depending on whether or not the old options were vested or not. New options issued in the exchange will vest over a two or three year period depending on whether the surrendered options were fully or partially vested. The incremental fair value created under the stock option exchange was $0.2 million, and this cost will be recognized on a straight line basis over the two or three year vesting period. The compensation cost of the original awards will continue to be expensed under the original vesting schedule.

During the third quarter 2012, we granted an aggregate of 9.4 million options with a 10-year contractual term to select employees, including senior executives, excluding the chief executive officer. The options will vest in three tranches one year after MEMC stock achieves the following three price hurdles for 30 consecutive calendar days: $7.00, $10.00 and $15.00. If the individual price hurdles are not met within five years of the grant date, the options tied to that individual price hurdle will be cancelled. The grant date fair value of these awards was $11.0 million and this compensation cost will be expensed on a straight line basis over the service period of each separately identified tranche. The grant date fair value was calculated for these awards using a probabilistic approach under a Monte Carlo simulation taking into consideration volatility, interest rates and expected term. Because the vesting of these awards is based on stock price performance (i.e. a market condition), it is classified as an equity award. The market price hurdles were not met during 2012.

Our weighted-average assumptions are as follows:

	2012		2011		2010
Risk-free interest rate	0.8	%	1.7	%	1.8	%
Expected stock price volatility	68.1	%	65.7	%	67.0	%
Expected term until exercise (years)	4		4		4
Expected dividends	—	%	—	%	—	%

The weighted-average grant-date fair value per share of options granted was $1.18, $5.94 and $7.04 for 2012, 2011 and 2010, respectively. As of December 31, 2012, $36.0 million of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of 3.4 years.

Restricted stock units represent the right to receive a share of MEMC stock at a designated time in the future, provided the stock unit is vested at the time. Recipients of restricted stock units do not pay any cash consideration for the restricted stock units or the underlying shares, and do not have the right to vote or have any other rights of a stockholder until such time as the underlying shares of stock are distributed. Restricted stock units granted to non-employee directors generally vest over a two-year period from the grant date. Restricted stock units granted to employees usually have three, four or five year cliff vesting, or four-year ratable vesting, and certain grants are subject to performance conditions established at the time of grant.

In conjunction with our purchase of SunEdison on November 20, 2009, we approved a Special Inducement Grant Plan. Pursuant to this plan, SunEdison’s senior management and certain continuing SunEdison employees received an aggregate of 584,372 restricted stock units which cliff vested on the one year anniversary date of the acquisition. Also under this plan, continuing SunEdison employees were granted an additional aggregate of 1,644,529 restricted stock units which will be subject to both future performance and time vesting requirements. The performance requirements of this latter set of grants are tied to the same metrics as the contingent consideration payable to SunEdison unit holders. SunEdison met its performance requirements and the former SunEdison employees had the following vesting schedule: (i) 34% of such earned grants vested on January 31, 2011, (ii) 33% vested on December 31, 2011, and (iii) the remaining 33% vested on December 31, 2012. The expense associated with these RSUs was not considered part of the purchase price of SunEdison because the employees were required to render future service in order to vest in these awards and thus, the compensation expense is recognized over the future vesting periods as the services are rendered. The amount of stock compensation expense for the year ended December 31, 2012, 2011 and 2010 related to the cliff vesting awards was $0.0, $1.6 million and $6.2 million, respectively. The amount of stock compensation expense for the year ended December 31, 2012, 2011 and 2010 related to the performance awards was $2.7 million, $3.2 million and $8.1 million, respectively.

The following table presents information regarding outstanding restricted stock units as of December 31, 2012 and changes during the year then ended:

	Restricted Stock Units		Aggregate Intrinsic Value (in millions)		Weighted-Average Remaining Contractual Life
Beginning of year	4,692,159
Granted	1,469,549
Converted	(680,611	)
Forfeited	(1,079,329	)
End of year	4,401,768		$	13.7	2

At December 31, 2012, there were no restricted stock units which were convertible. As of December 31, 2012, $18.9 million of total unrecognized compensation cost related to restricted stock units is expected to be recognized over a weighted-average period of approximately 2 years. The weighted-average fair value of restricted stock units on the date of grant was $3.06, $11.09 and $14.64 in 2012, 2011 and 2010, respectively.

The amount of stock-based compensation cost capitalized into inventory and fixed assets was not material for the years ended December 31, 2012, 2011 and 2010. Further, the recognition of excess tax benefits from share-based payment arrangements was not material for the years ended December 31, 2012, 2011 and 2010.

Stock-based compensation expense recorded for the years ended December 31, 2012, 2011 and 2010 was allocated as follows:

	2012		2011		2010
In millions
Cost of goods sold	$	5.9	$	5.9	$	5.7
Marketing and administration	21.7		32.5		40.8
Research and development	3.8		5.0		4.7
Stock-based employee compensation	$	31.4	$	43.4	$	51.2

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Revenue and Profit Deferrals

12 Months Ended

Dec. 31, 2012

Deferred Revenue Disclosure [Abstract]

REVENUE AND PROFIT DEFERRALS

REVENUE AND PROFIT DEFERRALS

	As of December 31,
	2012		2011
In millions
Deferred revenue and profit for solar energy systems:
Short-term profit deferrals and deposits on solar energy system sales	$	113.1	$	41.4
Long-term profit deferrals and deposits on solar energy system sales	126.4		138.0
Deferred subsidy revenue	19.6		19.4
Total solar energy system deferred revenue	$	259.1	$	198.8
Non-solar energy system deferred revenue:
Short-term deferred revenue	$	—	$	0.7
Long-term deferred revenue	29.2		51.2
Total non-solar energy system deferred revenue	$	29.2	$	51.9
Total deferred revenue	$	288.3	$	250.7

Solar Energy System Deferred Revenue

Our Solar Energy segment deferred revenue includes profit deferrals for performance guarantees on systems sold during 2012 and prior periods subject to real estate accounting, customer deposits received for solar energy systems under development, and deferred incentive subsidies that will be amortized over the depreciable life of the system. Profit deferrals for performance guarantees include system production guarantees that generally expire within two years of the system sale date and system uptime guarantees that generally expire during the final years of the system service contract term, which can extend up to twenty years. During the quarter ended December 31, 2012, we recognized revenue of $54.4 million related to profit deferrals on a power guarantee that expired on a 70MW project in Italy that was sold in the fourth quarter of 2010.

In addition to the deferred revenue above, SunEdison may receive upfront incentives or subsidies from various state governmental jurisdictions that are deferred and recognized on a straight-line basis over the depreciable life of the related solar energy system. During 2012, SunEdison received $1.0 million in upfront incentive payments and recognized $0.9 million as revenue.

Non Solar Energy System Deferred Revenue

In connection with our long-term solar wafer supply agreements executed during 2006 and subsequent amendments, we have received various equity instruments and other forms of additional consideration. In each case, we have recorded the estimated fair value of the additional consideration to long-term deferred revenue and will recognize the deferred revenue on a pro-rata basis as product is shipped over the life of the agreements. In addition, we have received upfront non-refundable customer deposits upon execution of certain take-or-pay contracts which are deferred and amortized against future purchases. These deposits will be recognized in earnings as we fulfill future customer purchase orders, for which the timing of such orders is not contractually fixed or specified.

During the second quarter of 2011, we resolved our long-term solar wafer supply agreement with Suntech. The consideration was comprised of the retention by MEMC of $53.0 million of cash previously deposited by Suntech under the supply agreement and held by MEMC at the time of the resolution, and a commitment to pay $67.0 million, which has been paid. Also, MEMC has retained the Suntech warrant originally issued to MEMC in July 2006, which had a related unamortized balance recorded in deferred revenues of $56.4 million prior to the resolution of the long-term solar wafer supply agreement. These three components totaled $176.4 million, of which $149.4 million, $19.4 million and $6.9 million was recorded during the second, third and fourth quarter of 2011, respectively. The remaining $0.7 million was deferred as of December 31, 2011 and was recognized as revenue in the first quarter of 2012.

During the third quarter of 2012, we agreed to terminate a long-term solar wafer supply agreement with Conergy AG. Under the terms of the supply agreement, we were to supply to Conergy solar grade silicon wafers over a ten-year period at pre-determined pricing for certain volumes on a take-or-pay basis. Conergy had agreed to advance funds to us in the form of both refundable and non-refundable deposits pursuant to the agreement. As part of the termination agreement with Conergy, we returned $21.3 million of the deposits and collected $21.2 million under an existing letter of credit established by Conergy in our favor. We expect payment of another $5.5 million, which is secured by a letter of credit, plus interest, that relates to the outstanding payables due to us as of December 31, 2012. In addition, Conergy assigned to us certain operations and maintenance service agreements for solar projects in Germany, Italy and Spain or the option to receive $3.0 million in cash. This assignment is subject to our due diligence. We recognized $37.1 million as revenue during the third quarter 2012 due to the fact that we were relieved of our future performance obligations under the agreement. The retention of the deposit, which was previously reflected as a liability, in satisfaction of the take or pay requirement has been classified as an operating cash inflow in the statement of cash flows.

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Variable Interest Entities (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Variable Interest Entity [Line Items]
Current assets	$ 10.3	$ 3.6
Noncurrent assets	56.2	62.7
Total assets	66.5	66.3
Current liabilities	(8.5)	(10.9)
Noncurrent liabilities	(69.6)	(57.4)
Total liabilities	$ (78.1)	$ (68.3)
Variable Interest Entity, Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Variable Interest Entity, Number Of Entities	5	3
Consolidated Entities [Member]
Variable Interest Entity [Line Items]
Number Of Entities Sold	1

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Commitments and Contingencies Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases

Our operating lease obligations as of December 31, 2012 were as follows:

	Payments Due By Period
	Total		2013		2014		2015		2016		2017		Thereafter
In millions
Operating Leases	$	96.3	$	25.3	$	22.2	$	19.8	$	13.3	$	7.3	$	8.4

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Condensed Consolidating Financial Information (Schedule of Condensed Consolidating Balance Sheet) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Current assets:
Cash and cash equivalents	$ 572.6	$ 585.8	$ 707.3	$ 632.7
Restricted cash	72.4	125.2
Accounts receivable, net	220.4	202.9
Inventories	247.8	321.8
Solar energy systems held for development and sale	133.8	373.0
Prepaid and other current assets	212.2	277.2
Total current assets	1,459.2	1,885.9
Investments	49.6	54.5
Investments in subsidiaries	0	0
Semiconductor and Solar Materials	1,213.1	1,253.7
Solar energy systems	1,459.9	1,139.4
Deferred tax assets, net	0	44.8
Restricted cash	50.2	37.5
Other assets	355.4	316.6
Goodwill		0	342.7
Intangible assets, net	114.2	149.2
Total assets	4,701.6	4,881.6
Current liabilities:
Current portion of long-term debt and capital lease obligations	3.4	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	97.8	144.2
Accounts payable	477.0	694.6
Accrued liabilities	344.2	409.0
Deferred revenue for solar energy systems	113.1	41.4
Contingent consideration related to acquisitions	23.1	71.6
Customer and other deposits	77.2	72.4
Intercompany (receivalbe) payable and short trem notes	0	0
Total current liabilities	1,135.8	1,436.9
Long-term debt and capital lease obligations, less current portion	758.7	567.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	1,508.4	1,211.2
Pension and post-employment liabilities	52.7	69.4
Customer and other deposits	184.5	276.8
Deferred revenue for solar energy systems	146.0	157.4
Non solar energy systems deferred revenue	29.2	51.2
Long-term intercompany note (receivalbe) payable	0	0
Other liabilities	208.9	326.1
Total liabilities	4,024.2	4,096.7
Redeemable noncontrolling interest, Carrying Amount	11.3	0
Total MEMC stockholders' equity	575.3	737.9
Stockholders' Equity Attributable to Noncontrolling Interest	90.8	47.0
Total stockholders' equity	666.1	784.9	2,295.6	2,206.8
Total liabilities and stockholders' equity	4,701.6	4,881.6
MEMC, Inc. [Member]
Current assets:
Cash and cash equivalents	65.1	228.9	15.5	105.9
Restricted cash	0	0
Accounts receivable, net	62.0	65.3
Inventories	18.4	33.8
Solar energy systems held for development and sale	0	0
Prepaid and other current assets	24.9	34.6
Total current assets	170.4	362.6
Investments	7.3	3.3
Investments in subsidiaries	498.2	269.8
Semiconductor and Solar Materials	57.2	72.3
Solar energy systems	0	0
Deferred tax assets, net	0	36.3
Restricted cash	0	0
Other assets	29.4	24.7
Goodwill		0
Intangible assets, net	0	0
Total assets	762.5	769.0
Current liabilities:
Current portion of long-term debt and capital lease obligations	0	0
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	0	0
Accounts payable	11.9	20.0
Accrued liabilities	32.8	(9.6)
Deferred revenue for solar energy systems	0	0
Contingent consideration related to acquisitions	0	0
Customer and other deposits	10.9	30.1
Intercompany (receivalbe) payable and short trem notes	(651.0)	(605.7)
Total current liabilities	(595.4)	(565.2)
Long-term debt and capital lease obligations, less current portion	746.1	550.0
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	0	0
Pension and post-employment liabilities	23.9	40.5
Customer and other deposits	87.8	82.0
Deferred revenue for solar energy systems	0	0
Non solar energy systems deferred revenue	0	0
Long-term intercompany note (receivalbe) payable	(45.4)	(127.1)
Other liabilities	(29.8)	50.9
Total liabilities	187.2	31.1
Redeemable noncontrolling interest, Carrying Amount	0
Total MEMC stockholders' equity	575.3	737.9
Stockholders' Equity Attributable to Noncontrolling Interest	0	0
Total stockholders' equity	575.3	737.9
Total liabilities and stockholders' equity	762.5	769.0
Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	60.0	58.3	7.2	49.7
Restricted cash	0	0
Accounts receivable, net	23.7	42.5
Inventories	70.6	68.5
Solar energy systems held for development and sale	0.3	4.1
Prepaid and other current assets	40.1	36.9
Total current assets	194.7	210.3
Investments	20.4	24.4
Investments in subsidiaries	564.2	(51.6)
Semiconductor and Solar Materials	294.4	315.5
Solar energy systems	3.0	1.6
Deferred tax assets, net	0	(20.4)
Restricted cash	1.7	0.2
Other assets	44.0	45.9
Goodwill		0
Intangible assets, net	110.9	145.2
Total assets	1,233.3	671.1
Current liabilities:
Current portion of long-term debt and capital lease obligations	0	0
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	0.2	0.3
Accounts payable	67.0	82.0
Accrued liabilities	42.5	104.6
Deferred revenue for solar energy systems	23.1	12.0
Contingent consideration related to acquisitions	40.7	71.6
Customer and other deposits	0.4	0.4
Intercompany (receivalbe) payable and short trem notes	764.3	619.9
Total current liabilities	938.2	890.8
Long-term debt and capital lease obligations, less current portion	0	0
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	9.8	2.3
Pension and post-employment liabilities	0
Customer and other deposits	0	0
Deferred revenue for solar energy systems	45.8	27.0
Non solar energy systems deferred revenue	0	0
Long-term intercompany note (receivalbe) payable	(96.2)	(16.4)
Other liabilities	112.0	23.4
Total liabilities	1,009.6	927.1
Redeemable noncontrolling interest, Carrying Amount	0
Total MEMC stockholders' equity	223.7	(256.6)
Stockholders' Equity Attributable to Noncontrolling Interest	0	0.6
Total stockholders' equity	223.7	(256.0)
Total liabilities and stockholders' equity	1,233.3	671.1
Non-Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	447.5	298.6	684.6	477.1
Restricted cash	72.4	125.2
Accounts receivable, net	134.7	95.1
Inventories	200.0	271.0
Solar energy systems held for development and sale	213.7	373.0
Prepaid and other current assets	147.2	205.7
Total current assets	1,215.5	1,368.6
Investments	21.9	26.8
Investments in subsidiaries	0	0
Semiconductor and Solar Materials	913.8	916.4
Solar energy systems	1,361.3	1,098.9
Deferred tax assets, net	0	28.9
Restricted cash	48.5	37.3
Other assets	282.0	246.0
Goodwill		0
Intangible assets, net	3.3	4.0
Total assets	3,846.3	3,726.9
Current liabilities:
Current portion of long-term debt and capital lease obligations	3.4	3.7
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	97.6	143.9
Accounts payable	398.1	592.6
Accrued liabilities	268.9	314.0
Deferred revenue for solar energy systems	0	29.4
Contingent consideration related to acquisitions	72.4	0
Customer and other deposits	65.9	41.9
Intercompany (receivalbe) payable and short trem notes	(113.3)	(14.2)
Total current liabilities	793.0	1,111.3
Long-term debt and capital lease obligations, less current portion	12.6	17.7
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	1,498.6	1,208.9
Pension and post-employment liabilities	28.8	28.9
Customer and other deposits	96.7	194.8
Deferred revenue for solar energy systems	100.2	130.4
Non solar energy systems deferred revenue	29.2	51.2
Long-term intercompany note (receivalbe) payable	141.6	143.5
Other liabilities	126.7	251.8
Total liabilities	2,827.4	3,138.5
Redeemable noncontrolling interest, Carrying Amount	11.3
Total MEMC stockholders' equity	916.8	542.0
Stockholders' Equity Attributable to Noncontrolling Interest	90.8	46.4
Total stockholders' equity	1,007.6	588.4
Total liabilities and stockholders' equity	3,846.3	3,726.9
Consolidation, Eliminations [Member]
Current assets:
Cash and cash equivalents	0	0	0	0
Restricted cash	0	0
Accounts receivable, net	0	0
Inventories	(41.2)	(51.5)
Solar energy systems held for development and sale	(80.2)	(4.1)
Prepaid and other current assets	0	0
Total current assets	(121.4)	(55.6)
Investments	0	0
Investments in subsidiaries	(1,062.4)	(218.2)
Semiconductor and Solar Materials	(52.3)	(50.5)
Solar energy systems	95.6	38.9
Deferred tax assets, net	0	0
Restricted cash	0	0
Other assets	0	0
Goodwill		0
Intangible assets, net	0	0
Total assets	(1,140.5)	(285.4)
Current liabilities:
Current portion of long-term debt and capital lease obligations	0	0
Short-term solar energy system debt and current portion of solar energy system debt, financings and capital leaseback obligations	0	0
Accounts payable	0	0
Accrued liabilities	0	0
Deferred revenue for solar energy systems	0	0
Contingent consideration related to acquisitions	0	0
Customer and other deposits	0	0
Intercompany (receivalbe) payable and short trem notes	0	0
Total current liabilities	0	0
Long-term debt and capital lease obligations, less current portion	0	0
Long-term solar energy system debt, financings and capital leaseback obligations, less current portion	0	0
Pension and post-employment liabilities	0	0
Customer and other deposits	0	0
Deferred revenue for solar energy systems	0	0
Non solar energy systems deferred revenue	0	0
Long-term intercompany note (receivalbe) payable	0	0
Other liabilities	0	0
Total liabilities	0	0
Redeemable noncontrolling interest, Carrying Amount	0
Total MEMC stockholders' equity	(1,140.5)	(285.4)
Stockholders' Equity Attributable to Noncontrolling Interest	0	0
Total stockholders' equity	(1,140.5)	(285.4)
Total liabilities and stockholders' equity	$ (1,140.5)	$ (285.4)

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Debt and Capital Lease Obligations (Tables)

12 Months Ended

Dec. 31, 2012

Debt and Capital Lease Obligations [Abstract]

Debt

Debt (including consolidated VIEs) and capital lease obligations outstanding consist of the following:

	As of December 31, 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 and capital leases:
Senior notes	$	550.0	$	—	$	550.0	$	550.0	$	—	$	550.0
Second lien term loan, including amortization of discount	196.1		—		196.1		—		—		—
Long-term notes	16.0		3.4		12.6		21.4		3.7		17.7
Total Non-Solar energy system debt and capital leases	$	762.1	$	3.4	$	758.7	$	571.4	$	3.7	$	567.7
Solar energy system debt, financings and capital leaseback obligations:
Short-term debt, weighted average interest rate of 6.47% and 6.23%, respectively	$	14.7	$	14.7	$	—	$	77.2	$	77.2	$	—
System construction and term debt	271.3		61.3		210.0		305.8		27.9		277.9
Capital leaseback obligations	93.3		7.5		85.8		107.8		13.3		94.5
Financing leaseback obligations	1,107.2		14.3		1,092.9		837.0		8.4		828.6
Other system financing transactions	119.7		—		119.7		27.6		17.4		10.2
Total Solar energy system debt, financings and capital leaseback obligations	$	1,606.2	$	97.8	$	1,508.4	$	1,355.4	$	144.2	$	1,211.2
Total debt outstanding	$	2,368.3	$	101.2	$	2,267.1	$	1,926.8	$	147.9	$	1,778.9

Redemption Prices

Year	Price
2014	105.813	%
2015	103.875	%
2016	101.938	%
2017 and thereafter	100.000	%

Principal Payments on Long-term Debt

The aggregate amounts of payments on long-term debt, excluding financing leaseback obligations, after December 31, 2012 are as follows:

	2013		2014		2015		2016		2017		Thereafter		Total
In millions
Maturities of long-term debt (a)	$	64.6	$	30.8	$	28.6	$	51.0	$	206.7	$	771.2	$	1,152.9

(a) Included in maturities of long-term debt is $119.7 million of maturities relating to other system financing transactions that represent the contract price for solar energy systems under existing sales contracts that contain certain contractual provisions that preclude sale treatment under real estate accounting rules. We account for these transactions as financings of $17.6 million and $102.1 million that will mature upon the expiration of the contractual provisions that preclude sale treatment in years 2015 and thereafter, respectively. These could become payment obligations in the event we default under the executed sales agreement, and the buyer may execute its contractual option to put (sell) the project back to SunEdison for a full refund of the contract price.

Minimum Lease Payments on Capital Leases

The aggregate amounts of payments on capital leases after December 31, 2012 are as follows:

In millions
2013	$	9.8
2014	6.6
2015	5.3
2016	5.7
2017	5.8
Thereafter	90.9
Total minimum lease payments	124.1
Less amounts representing interest	(30.8		)
Present value of minimum lease payments	93.3
Less current portion of obligations under capital leases	(7.5		)
Noncurrent portion of obligations under capital leases	$	85.8

Schedule of Minimum Lease Payments on Sale Leaseback Obligations

The aggregate amounts of minimum lease payments on our financing leaseback obligations are $890.2 million. Payments from 2013 through 2017 are as follows:

In millions	2013		2014		2015		2016		2017
Minimum lease payments	$	60.5	$	48.5	$	46.4	$	42.9	$	40.9

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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%

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Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash flows from operating activities:
Net (loss) income	$ (148.7)	$ (1,520.0)	$ 48.0
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation and amortization	246.9	227.1	164.8
Goodwill impairment charges	0	440.5	0
Long-lived asset impairment charges	20.0	381.7	0
Investment impairments	3.6	78.9	0
Stock-based compensation	31.7	43.9	51.6
Deferred revenue recognized	(73.8)	(67.9)	(13.1)
Provision (benefit) for deferred taxes	10.5	60.0	(44.7)
Loss on supplier contracts	0	77.9	0
Change in contingent consideration for acquisitions	13.3	(25.2)	(3.0)
Other	12.9	6.0	(17.4)
Changes in operating assets and liabilities (net of effects from acquisitions)
Accounts receivable	(19.6)	73.6	(117.2)
Inventories	94.8	(108.2)	(65.0)
Solar energy systems held for sale and development	(72.4)	(167.5)	(158.5)
Income taxes receivable and payable	8.7	(16.5)	81.4
Prepaid and other current assets	5.6	27.8	(179.0)
Non solar energy system deferred revenue and customer deposits	(33.9)	109.5	48.4
Accounts payable and accrued liabilities	(343.7)	226.2	443.3
Deferred revenue for solar energy systems	121.5	123.4	78.8
Pension and post-employment liabilities	1.8	11.0	2.4
Other	(142.7)	2.5	26.8
Net cash (used in) provided by operating activities	(263.5)	(15.3)	347.6
Cash flows from investing activities:
Capital expenditures	(139.0)	(452.5)	(352.0)
Construction of solar energy systems	(346.9)	(598.1)	(280.1)
Cash payments for acquisitions, net of cash acquired	0	(164.0)	(73.5)
Proceeds from sale and maturities of investments	0	0	185.0
Proceeds from equity method investments	5.8	95.7	85.3
Purchases of cost and equity method investments	(47.8)	(50.4)	(18.8)
Cash received from net investment hedge	0	0	17.6
Receipts from (payments to) vendors for refundable deposits on long-term agreements and loans	8.6	(14.5)	(85.0)
Change in restricted cash	6.7	(123.8)	(1.8)
Proceeds from sale of property, plant and equipment	0	43.9	0
Other	0.1	0.8	1.5
Net cash used in investing activities	(512.5)	(1,262.9)	(521.8)
Cash flows from financing activities:
Proceeds from Issuance of Long-term Debt	196.0	550.0	0
Proceeds from solar energy system financing and capital lease obligations	904.2	1,071.2	364.4
Repayments of solar energy system financing and capital lease obligations	(246.2)	(266.5)	(61.1)
Net repayments of customer deposits related to long-term supply agreements	(24.4)	(57.7)	(31.3)
Principal payments on long-term debt	(3.6)	(3.7)	(4.8)
Cash paid for contingent consideration	(69.2)	(50.2)	0
Receipts from (purchases of) noncontrolling interest	50.8	(49.0)	(8.3)
Common stock repurchases	(0.5)	(3.6)	(2.9)
Debt financing fees	(42.3)	(39.8)	(12.8)
Net cash provided by (used in) financing activities	764.8	1,150.7	243.2
Effect of exchange rate changes on cash and cash equivalents	(2.0)	6.0	5.6
Net (decrease) increase in cash and cash equivalents	(13.2)	(121.5)	74.6
Cash and cash equivalents at beginning of period	585.8	707.3	632.7
Cash and cash equivalents at end of period	$ 572.6	$ 585.8	$ 707.3

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract]
U.S.	$ (261.1)	$ (780.6)	$ (157.8)
Foreign	179.6	(603.5)	145.3
Loss before income tax expense (benefit) and equity in (loss) earnings of joint ventures	(81.5)	(1,384.1)	(12.5)
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract]
Current Federal Tax Expense (Benefit)	38.9	6.7	(46.6)
Deferred Federal Income Tax Expense (Benefit)	(0.2)	37.2	(29.6)
Federal Income Tax Expense (Benefit), Continuing Operations	38.7	43.9	(76.2)
Current State and Local Tax Expense (Benefit)	(14.0)	4.6	(3.8)
Deferred State and Local Income Tax Expense (Benefit)	0.7	4.7	(2.3)
State and Local Income Tax Expense (Benefit), Continuing Operations	(13.3)	9.3	(6.1)
Current Foreign Tax Expense (Benefit)	47.5	15.9	44.2
Deferred Foreign Income Tax Expense (Benefit)	(8.0)	4.0	(15.2)
Foreign Income Tax Expense (Benefit), Continuing Operations	39.5	19.9	29.0
Current Income Tax Expense (Benefit)	72.4	27.2	(6.2)
Deferred Income Tax Expense (Benefit)	(7.5)	45.9	(47.1)
Income Tax Expense (Benefit), Continuing Operations	64.9	73.1	(53.3)
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract]
Income tax at federal statutory rate	(35.00%)	(35.00%)	(35.00%)
Effect of foreign operations	(71.60%)	19.30%	(47.40%)
Foreign incentives	(5.70%)	(1.10%)	(121.60%)
Foreign repatriation	(2.10%)	0.40%	(91.70%)
State income taxes, net of U.S. Federal benefit	(16.60%)	0.70%	(26.80%)
Tax authority positions, net	3.80%	1.20%	(97.00%)
Valuation allowance	183.20%	15.10%	0.00%
Other, net	23.60%	4.70%	(6.90%)
Effective tax expense (benefit) rate	79.60%	5.30%	(426.40%)
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Beginning of year	46.2	30.4
Additions based on tax positions related to the current year	7.8	15.9
Reductions for tax positions of prior years	(3.1)	(0.1)
End of year	50.9	46.2	30.4
Deferred tax assets:
Inventories	14.9	17.1
Restructuring liabilities	31.2	42.5
Expense accruals	52.0	53.1
Solar energy systems	461.9	366.7
Deferred tax assets, deferred revenue	66.3	4.4
Property, plant and equipment	35.7	54.1
Pension, medical and other employee benefits	12.2	27.2
Foreign repatriation	3.4	3.4
Net operating loss carryforwards	132.3	91.5
Foreign tax credits	70.8	28.8
Other	75.6	38.4
Total deferred tax assets	956.3	727.2
Valuation allowance	(510.5)	(415.7)
Net deferred tax assets	445.8	311.5
Deferred tax liabilities:
Solar energy systems	(286.7)	(191.2)
Other	(74.2)	(12.4)
Total deferred tax liabilities	(360.9)	(203.6)
Deferred Tax Assets, Net, Classification [Abstract]
Current deferred tax assets, net (recorded in prepaids and other current assets)	90.8	63.1
Non-current deferred tax assets, net	(5.9)	44.8
Net deferred tax assets	$ 84.9	$ 107.9

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Nature of Operations

12 Months Ended

Dec. 31, 2012

Nature of Operations [Abstract]

NATURE OF OPERATIONS

NATURE OF OPERATIONS

MEMC is a global leader in the development, manufacture and sale of silicon wafers, and a major developer and seller of photovoltaic energy solutions. Through SunEdison, MEMC is one of the world’s leading developers of solar energy projects and, we believe, one of the most geographically diverse. MEMC’s technology leadership in silicon and downstream solar are enabling the company to expand its customer base and lower costs throughout the silicon supply chain.

From January 1, 2010 until December 31, 2011, MEMC was organized by end market, with three business segments: Semiconductor Materials, Solar Materials, and Solar Energy. Semiconductor Materials provides silicon wafers ranging from 100 millimeter (4 inch) to 300 millimeter (12 inch) as the base material for the production of semiconductor devices. Solar Materials manufactured and sold silicon wafers for solar applications, primarily 156 millimeter. Solar Energy was comprised of the SunEdison solar energy business unit which designed, developed, and constructed solar energy systems. During the fourth quarter of 2011, we initiated a large scale global restructuring plan across all of our reportable segments (see Note 3). As part of our restructuring plan, effective January 1, 2012, we consolidated our two solar business units' operations into one business unit, and since that date, we have been engaged in two reportable segments, Semiconductor Materials and Solar Energy. These consolidated financial statements and related notes to the consolidated financial statements, including prior year financial information, are presented based on two reporting segments for all periods presented.

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Restructuring and Impairment Charges (Summary of Significant Restructuring, Impairment and Other Charges) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Restructuring Cost and Reserve [Line Items]
Restructuring	$ 339.5	$ (83.5)	$ 350.7	$ 5.3
Long-lived asset impairment charges	365.4	20.0	381.7	0
Goodwill, Impairment Loss	384.1	0	440.5	0
Investment impairments	78.9	3.6	78.9	0
Inventory adjustments	96.7	3.4	107.0
Semiconductor Materials [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring	35.6
Long-lived asset impairment charges	7.4
Goodwill, Impairment Loss	0
Investment impairments	0
Inventory adjustments	14.2
Solar Energy [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring	303.0
Long-lived asset impairment charges	358.0
Goodwill, Impairment Loss	384.1	440.5	440.5	0
Investment impairments	78.9
Inventory adjustments	82.5
Corporate Elimination [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring	0.9
Long-lived asset impairment charges	0
Goodwill, Impairment Loss	0
Investment impairments	0
Inventory adjustments	$ 0

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Stockholders' Equity (Outstanding Stock Options) (Details) (USD $)	1 Months Ended	12 Months Ended
	Aug. 17, 2012	Dec. 31, 2012 Y
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Beginning of year (in shares)		17,066,401
Granted (in shares)		16,119,890
Exercised (in shares)		0
Forfeited (in shares)	(6,900,000)	(6,090,871)
Expired (in shares)		(5,684,301)
End of year (in shares)		21,411,119
Options exercisable at year-end		2,940,515
Beginning of year, Weighted Average Exercise Price		$ 19.21
Stock Options Granted, Weighted Average Exercise Price		$ 2.82
Stock Options Exercised, Weighted Average Exercise Price		$ 0.00
Stock Options Forfeited, Weighted Average Exercise Price		$ 11.59
Stock Options Expired, Weighted Average Exercise Price		$ 30.20
End of year, Weighted Average Exercise Price		$ 6.12
Options exercisable at year-end, Weighted Average Exercise Price		$ 17.50
End of year, Aggregate Intrinsic Value		$ 7.7
Option exercisable at year-end, Aggregate Intrinsic Value		$ 7.5
End of year, Weighted Average Remaining Contractual Life (in years)		8
Options exercisable at year-end, Weighted Average Remaining Contractual Life (in years)		6

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Condensed Consolidating Financial Information (Condensed Consolidating Statement of Cash Flows) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$ (263.5)	$ (15.3)	$ 347.6
Cash flows from investing activities:
Capital expenditures	(139.0)	(452.5)	(352.0)
Construction of solar energy systems	(346.9)	(598.1)	(280.1)
Proceeds from sale and maturities of investments	0	0	185.0
Purchases of cost and equity method investments	(47.8)	(50.4)	(18.8)
Purchases of investments			85.3
Proceeds from return of equity method investment	5.8	95.7	85.3
Change in Restricted cash	6.7	(123.8)	(1.8)
Payments to vendors for refundable deposits on long-term agreements	8.6	(14.5)	(85.0)
Proceeds from sale of property, plant and equipment	0	43.9	0
Cash paid for acquisitions, net of cash acquired	0	(164.0)	(73.5)
Equity Infusions or investments in subsidiaries	0	0	0
Other	(8.7)	(0.8)	(19.1)
Net cash used in investing activities	(512.5)	(1,262.9)	(521.8)
Proceeds from Issuance of Long-term Debt	196.0	550.0	0
Cash flows from financing activities:
Cash paid for contingent consideration	(69.2)	(50.2)	0
Proceeds from solar energy system financing and capital lease obligations	904.2	1,071.2	364.4
Repayments of solar energy system financing and capital lease obligations	(246.2)	(266.5)	(61.1)
Net repayments of customer deposits related to long-term supply agreements	(24.4)	(57.7)	(31.3)
Principal payments on long-term debt	(3.6)	(3.7)	(4.8)
Excess tax benefits from share-based payment arrangements			(8.3)
Common stock repurchased	(0.5)	(3.6)	(2.9)
Dividends to noncontrolling interest	50.8	(49.0)
Receipts from (purchases of) noncontrolling interest	(50.8)	49.0	8.3
(Repayment of) collection of intercompany debt	0	0	0
Debt financing fees	(42.3)	(39.8)	(12.8)
Net cash provided by (used in) financing activities	764.8	1,150.7	243.2
Effect of exchange rate changes on cash and cash equivalents	(2.0)	6.0	5.6
Net increase (decrease) in cash and cash equivalents	(13.2)	(121.5)	74.6
Cash and cash equivalents at beginning of period	585.8	707.3	632.7
Cash and cash equivalents at end of period	572.6	585.8	707.3
Proceeds from (Repurchase of) Equity	(0.5)	(3.6)	(2.9)
MEMC, Inc. [Member]
Cash flows from operating activities:
Net cash (used in) provided by operating activities	(213.7)	(216.5)	(128.4)
Cash flows from investing activities:
Capital expenditures	(18.0)	(24.1)	(25.1)
Construction of solar energy systems	0	0	0
Proceeds from sale and maturities of investments			0
Purchases of cost and equity method investments	(8.2)	(1.1)	0
Purchases of investments			85.3
Proceeds from return of equity method investment	10.0	82.0
Change in Restricted cash	0	0	0
Payments to vendors for refundable deposits on long-term agreements		0	0
Proceeds from sale of property, plant and equipment		0
Cash paid for acquisitions, net of cash acquired		0	(75.7)
Equity Infusions or investments in subsidiaries	(44.0)	82.9	(30.2)
Other	(2.0)	(5.7)	(30.7)
Net cash used in investing activities	(58.2)	145.4	(15.0)
Proceeds from Issuance of Long-term Debt	196.0	550.0
Cash flows from financing activities:
Cash paid for contingent consideration	0	0
Proceeds from solar energy system financing and capital lease obligations	0	0	0
Repayments of solar energy system financing and capital lease obligations	0	0	0
Net repayments of customer deposits related to long-term supply agreements	0	0	0
Principal payments on long-term debt	0	0	0
Common stock repurchased	(0.5)	(3.6)	(2.9)
Dividends to noncontrolling interest	0	0	0
(Repayment of) collection of intercompany debt	(74.4)	(243.7)	55.9
Debt financing fees	(12.7)	(18.0)	0
Net cash provided by (used in) financing activities	108.4	284.7	53.0
Effect of exchange rate changes on cash and cash equivalents	(0.3)	(0.2)	0
Net increase (decrease) in cash and cash equivalents	(163.8)	213.4	(90.4)
Cash and cash equivalents at beginning of period	228.9	15.5	105.9
Cash and cash equivalents at end of period	65.1	228.9	15.5
Proceeds from (Repurchase of) Equity	(0.5)	(3.6)	(2.9)
Guarantor Subsidiaries [Member]
Cash flows from operating activities:
Net cash (used in) provided by operating activities	9.4	66.3	65.0
Cash flows from investing activities:
Capital expenditures	(19.5)	(56.4)	(45.7)
Construction of solar energy systems	0	0	(1.4)
Proceeds from sale and maturities of investments			0
Purchases of cost and equity method investments	0	(5.0)	(10.4)
Purchases of investments			0
Proceeds from return of equity method investment	0	13.7
Change in Restricted cash	(1.5)	0.5	0.3
Payments to vendors for refundable deposits on long-term agreements		(14.4)	0
Proceeds from sale of property, plant and equipment		0
Cash paid for acquisitions, net of cash acquired		(160.1)	2.2
Equity Infusions or investments in subsidiaries	(6.7)	2.8	1.8
Other	(0.1)	0.1	(2.9)
Net cash used in investing activities	(27.6)	(219.0)	(50.3)
Proceeds from Issuance of Long-term Debt	0	0
Cash flows from financing activities:
Cash paid for contingent consideration	(15.1)	(50.2)
Proceeds from solar energy system financing and capital lease obligations	8.4	0.5	1.8
Repayments of solar energy system financing and capital lease obligations	(0.5)	(1.8)	(1.9)
Net repayments of customer deposits related to long-term supply agreements	0	(1.8)	(0.4)
Principal payments on long-term debt	0	0	0
Common stock repurchased	0	0	0
Dividends to noncontrolling interest	0	0	(0.8)
(Repayment of) collection of intercompany debt	27.1	257.2	(55.9)
Debt financing fees	0	0	0
Net cash provided by (used in) financing activities	19.9	203.9	(57.2)
Effect of exchange rate changes on cash and cash equivalents	0	(0.1)	0
Net increase (decrease) in cash and cash equivalents	1.7	51.1	(42.5)
Cash and cash equivalents at beginning of period	58.3	7.2	49.7
Cash and cash equivalents at end of period	60.0	58.3	7.2
Proceeds from (Repurchase of) Equity	0	0	0
Non-Guarantor Subsidiaries [Member]
Cash flows from operating activities:
Net cash (used in) provided by operating activities	(7.3)	193.0	318.5
Cash flows from investing activities:
Capital expenditures	(101.5)	(372.0)	(281.2)
Construction of solar energy systems	(387.8)	(627.5)	(171.9)
Proceeds from sale and maturities of investments			185.0
Purchases of cost and equity method investments	(39.6)	(44.3)	(8.4)
Purchases of investments			0
Proceeds from return of equity method investment	(4.2)	0
Change in Restricted cash	8.2	(124.3)	(2.1)
Payments to vendors for refundable deposits on long-term agreements		(0.1)	(85.0)
Proceeds from sale of property, plant and equipment		43.9
Cash paid for acquisitions, net of cash acquired		(3.9)	0
Equity Infusions or investments in subsidiaries	50.7	(85.7)	28.4
Other	4.4	33.5	28.8
Net cash used in investing activities	(478.6)	(1,247.4)	(364.0)
Proceeds from Issuance of Long-term Debt	0	0
Cash flows from financing activities:
Cash paid for contingent consideration	(54.1)	0
Proceeds from solar energy system financing and capital lease obligations	895.8	1,070.7	362.6
Repayments of solar energy system financing and capital lease obligations	(245.7)	(264.7)	(59.2)
Net repayments of customer deposits related to long-term supply agreements	(24.4)	(55.9)	(30.9)
Principal payments on long-term debt	(3.6)	(3.7)	(4.8)
Common stock repurchased	0	0	0
Dividends to noncontrolling interest	50.8	(49.0)	(7.5)
(Repayment of) collection of intercompany debt	47.3	(13.5)	0
Debt financing fees	(29.6)	(21.8)	(12.8)
Net cash provided by (used in) financing activities	636.5	662.1	247.4
Effect of exchange rate changes on cash and cash equivalents	(1.7)	6.3	5.6
Net increase (decrease) in cash and cash equivalents	148.9	(386.0)	207.5
Cash and cash equivalents at beginning of period	298.6	684.6	477.1
Cash and cash equivalents at end of period	447.5	298.6	684.6
Proceeds from (Repurchase of) Equity	0	0	0
Consolidation, Eliminations [Member]
Cash flows from operating activities:
Net cash (used in) provided by operating activities	(51.9)	(58.1)	92.5
Cash flows from investing activities:
Capital expenditures	0	0	0
Construction of solar energy systems	40.9	29.4	(106.8)
Proceeds from sale and maturities of investments			0
Purchases of cost and equity method investments	0	0	0
Purchases of investments			0
Proceeds from return of equity method investment	0	0
Change in Restricted cash	0	0	0
Payments to vendors for refundable deposits on long-term agreements		0	0
Proceeds from sale of property, plant and equipment		0
Cash paid for acquisitions, net of cash acquired		0	0
Equity Infusions or investments in subsidiaries	0	0	0
Other	(11.0)	(28.7)	(14.3)
Net cash used in investing activities	51.9	58.1	(92.5)
Proceeds from Issuance of Long-term Debt	0	0
Cash flows from financing activities:
Cash paid for contingent consideration	0	0
Proceeds from solar energy system financing and capital lease obligations	0	0	0
Repayments of solar energy system financing and capital lease obligations	0	0	0
Net repayments of customer deposits related to long-term supply agreements	0	0	0
Principal payments on long-term debt	0	0	0
Common stock repurchased	0	0	0
Dividends to noncontrolling interest	0	0	0
(Repayment of) collection of intercompany debt	0	0	0
Debt financing fees	0	0	0
Net cash provided by (used in) financing activities	0	0	0
Effect of exchange rate changes on cash and cash equivalents	0	0	0
Net increase (decrease) in cash and cash equivalents	0	0	0
Cash and cash equivalents at beginning of period	0	0	0
Cash and cash equivalents at end of period	0	0	0
Proceeds from (Repurchase of) Equity	$ 0	$ 0	$ 0

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Solar Energy Systems Held for Development and Sale (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Solar Energy Systems Held For Development and Sale [Abstract]
Under development	$ 133.8	$ 193.5
Systems held for sale	0	179.5
Total solar energy systems held for development and sale	$ 133.8	$ 373.0

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Fair Value Measurements

12 Months Ended

Dec. 31, 2012

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

The following table summarizes the financial instruments measured at fair value on a recurring basis classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation in the accompanying consolidated balance sheets:

	As of December 31, 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	$	—		$	13.4		$	—		$	13.4		$	—	$	16.2		$	—		$	16.2
Suntech warrant	—			—			0.2			0.2			—		—			0.4			0.4
Interest rate swaps and option thereon	—			(5.0		)	—			(5.0		)	—		(5.6		)	—			(5.6		)
Currency forward contracts	(6.6		)	—			—			(6.6		)	1.2		—			—			1.2
Contingent consideration related to acquisitions	—			—			(24.9		)	(24.9		)	—		—			(90.8		)	(90.8		)
Total	$	(6.6	)	$	8.4		$	(24.7	)	$	(22.9	)	$	1.2	$	10.6		$	(90.4	)	$	(78.6	)

We acquired less than 10% of the common stock of Gintech at the same time as the execution of a long-term supply agreement with that customer. This investment is accounted for at fair value and is classified as a long-term available-for-sale investment.

The Suntech warrant consists of a fully vested, non-forfeitable warrant to purchase common shares of Suntech, a customer, which was received at the time that MEMC signed a long-term supply agreement with Suntech. We use a lattice model to determine the fair value of the Suntech warrant. Determining the appropriate fair value model and calculating the fair value of the warrant requires the making of estimates and assumptions, including Suntech’s stock price volatility, interest rates, expected dividends and the marketability of this investment. The Suntech warrant is considered a derivative and, accordingly, changes in the value of the Suntech warrant are recorded in non-operating expense (income). The notional amount of the warrant was $205.8 million as of December 31, 2012 and 2011.

Our interest rate swaps are considered over the counter derivatives, and fair value is calculated using a present value model with contractual terms for maturities, amortization and interest rates. Level 2, or market observable inputs, such as yield and credit curves are used within the present value models in order to determine fair value.

The fair value of our currency forward contracts is measured by the amount that would have been paid to liquidate and repurchase all open contracts and was a liability of $6.6 million at December 31, 2012, an asset of $1.2 million at December 31, 2011. See Note 5 for additional discussion.

We have estimated the fair value of the contingent consideration outstanding as of December 31, 2012 related to acquisitions at $24.9 million, which reflects a discount at a credit adjusted interest rate for the period of the contingency. That measure is based on significant inputs that are not observable in the market, which U.S. GAAP refers to as Level 3 inputs. Key assumptions include (i) a discount rate and (ii) a probability adjustment related to the entities' ability to meet operational metrics. See Note 19 for additional discussion.

There were no transfers into or out of Level 1 and Level 2 financial instruments during the year ended December 31, 2012. During the year ended December 31, 2011, there was a transfer into Level 1 of $80.2 million for the SunEdison contingent consideration as of December 31, 2010, because the fair value of the stock issued was based on the closing price of our stock, which is actively traded and considered a Level 1 input. No other transfers into or out of Level 1 and Level 2 financial instruments occurred during the year ended December 31, 2010. The following table summarizes changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended December 31, 2012 and 2011:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
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 (losses) gains included in earnings	(4.8		)	23.2			(1.6		)	16.8
Acquisitions	—			(87.8		)	—			(87.8		)
Balance at December 31, 2011	$	0.4		$	(90.8	)	$	—		$	(90.4	)
Total unrealized gains (losses) included in earnings	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)
Payment of contingent consideration	—			80.9			—			80.9
Balance at December 31, 2012	$	0.2		$	(24.9	)	$	—		$	(24.7	)
The amount of total (losses) gains in 2011 included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held at December 31, 2011	$	(4.8	)	$	23.2		$	(1.6	)	$	16.8
The amount of total losses in 2012 included in earnings attributable to the change in unrealized (losses) gains relating to assets and liabilities still held at December 31, 2012	$	(0.2	)	$	(15.0	)	$	—		$	(15.2	)

__________________________

(1) Amounts included in earnings are recorded to non-operating expense (income) in the consolidated statement of operations, except for the amounts for contingent consideration related to acquisitions, for which changes to the fair value were recorded to marketing and administration in the consolidated statement of operations for fair market value adjustments and to interest expense for accretion.

The carrying amount of our outstanding short-term debt, long-term debt and leaseback obligations at December 31, 2012 and 2011 was $2,368.3 million and $1,926.8 million, respectively. The estimated fair value of those obligations was $1,736.2 million and $1,333.6 million at December 31, 2012 and 2011, respectively. Fair value of our debt, excluding our 2019 Notes, is calculated using a discounted cash flow model with consideration for our non-performance risk (Level 3 assumptions). The estimated fair value of our 2019 Notes was based upon a broker quotation. The estimated fair value of our solar energy system debt related to sale-leasebacks is significantly lower than the carrying value of such debt because the fair value estimate is based on the fair value of our fixed lease payments over the term of the leases (Level 3 assumptions). Under real estate accounting, this debt is recorded as a financing obligation, and substantially all of our lease payments are recorded as interest expense with little to no reduction in our debt balance over the term of the lease. As a result, our outstanding sale-leaseback debt obligations will generally result in a one-time gain recognition at the end of the leases for the full amount of the debt. The timing difference between expense and gain recognition will result in increased expense during the term of the leases with a significant book gain at the end of the lease.

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Debt and Capital Lease Obligations (Debt) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Debt Instrument [Line Items]
Senior Notes	$ 550.0	$ 550.0
Senior Notes, Current	0	0
Senior notes	550.0	550.0
Loans Payable	196.1	0
Loans Payable, Current	0	0
Loans Payable, Noncurrent	196.1	0
Notes Payable	16.0	21.4
Notes Payable, Current	3.4	3.7
Notes Payable, Noncurrent	12.6	17.7
Debt and Capital Lease Obligations	762.1	571.4
Long-term Debt and Capital Lease Obligations, Current	3.4	3.7
Long-term Debt and Capital Lease Obligations	758.7	567.7
Capital Lease Obligations, Current	7.5
Noncurrent portion of obligations under capital leases	85.8
Short Term Solar Energy System Financing And Current Portion Of Long Term Solar Energy System Financing And Capital Lease Obligations	97.8	144.2
Long-term solar energy system financing and capital lease obligations, less current portion, including consolidated variable interest entities of $86.8 and $107.2 in 2011 and 2010, respectively	1,508.4	1,211.2
Debt And Capital Lease Obligations Including Solar Energy Systems Financing	2,368.3	1,926.8
Debt And Capital Lease Obligations Including Solar Energy Systems Financing, Current	101.2	147.9
Long Term Debt And Capital Lease Obligations Including Solar Energy Systems Financing	2,267.1	1,778.9
Solar Energy [Member]
Debt Instrument [Line Items]
Solar energy systems, weighted average interest rate of 6.15% and 6.13%, respectively	14.7	77.2
Short-term debt, weighted average interest rate	6.47%	6.23%
Long-term Debt	0	0
Capital Lease Obligations, Current	7.5	13.3
Noncurrent portion of obligations under capital leases	85.8	94.5
Sale Leaseback Transaction, Amount Due under Financing Arrangement	1,107.2	837.0
Short term financing obligation	14.3	8.4
Finance obligations	1,092.9	828.6
Other System Financing transactions	119.7	27.6
Other system financing transactions, current	0	17.4
Other system financing transactions, noncurrent	119.7	10.2
Long Term Solar Energy Systems Financing And Capital Leases	1,606.2	1,355.4
Short Term Solar Energy System Financing And Current Portion Of Long Term Solar Energy System Financing And Capital Lease Obligations	97.8	144.2
Long-term solar energy system financing and capital lease obligations, less current portion, including consolidated variable interest entities of $86.8 and $107.2 in 2011 and 2010, respectively	1,508.4	1,211.2
Construction and Term Debt [Member] | Solar Energy [Member]
Debt Instrument [Line Items]
Long-term Debt	271.3	305.8
Less current portion - Solar energy systems	61.3	27.9
Long-term Debt, Excluding Current Maturities	210.0	277.9
SunEdison [Member] | Solar Energy [Member]
Debt Instrument [Line Items]
Capital lease obligations	$ 93.3	$ 107.8

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Solar Energy Systems Held for Development and Sale (Tables)

12 Months Ended

Dec. 31, 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 consist of the following:

	As of December 31,
	2012		2011
In millions
Under development	$	133.8	$	193.5
Systems held for sale	—		179.5
Total solar energy systems held for development and sale	$	133.8	$	373.0

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Debt and Capital Lease Obligations

12 Months Ended

Dec. 31, 2012

Debt and Capital Lease Obligations [Abstract]

DEBT AND CAPITAL LEASE OBLIGATIONS

DEBT AND CAPITAL LEASE OBLIGATIONS

Debt (including consolidated VIEs) and capital lease obligations outstanding consist of the following:

	As of December 31, 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 and capital leases:
Senior notes	$	550.0	$	—	$	550.0	$	550.0	$	—	$	550.0
Second lien term loan, including amortization of discount	196.1		—		196.1		—		—		—
Long-term notes	16.0		3.4		12.6		21.4		3.7		17.7
Total Non-Solar energy system debt and capital leases	$	762.1	$	3.4	$	758.7	$	571.4	$	3.7	$	567.7
Solar energy system debt, financings and capital leaseback obligations:
Short-term debt, weighted average interest rate of 6.47% and 6.23%, respectively	$	14.7	$	14.7	$	—	$	77.2	$	77.2	$	—
System construction and term debt	271.3		61.3		210.0		305.8		27.9		277.9
Capital leaseback obligations	93.3		7.5		85.8		107.8		13.3		94.5
Financing leaseback obligations	1,107.2		14.3		1,092.9		837.0		8.4		828.6
Other system financing transactions	119.7		—		119.7		27.6		17.4		10.2
Total Solar energy system debt, financings and capital leaseback obligations	$	1,606.2	$	97.8	$	1,508.4	$	1,355.4	$	144.2	$	1,211.2
Total debt outstanding	$	2,368.3	$	101.2	$	2,267.1	$	1,926.8	$	147.9	$	1,778.9

Non-Solar Energy System Debt and Capital Leases

Senior Notes

On March 10, 2011, we issued $550.0 million of 7.75% Senior Notes due April 1, 2019 ("2019 Notes"). We incurred $13.8 million in debt issuance costs, which is amortized into the consolidated statement of operations over the eight year term. The 2019 Notes were sold at a price equal to 100% of the principal amount thereof. The interest on the 2019 Notes is payable semi-annually, in cash in arrears, on April 1 and October 1, commencing October 1, 2011. We may redeem the 2019 Notes at our option, in whole or in part, at any time on or after April 1, 2014, upon not less than 30 nor more than 60 days notice at the redemption prices (expressed as percentages of the principal amount to be redeemed) set forth below, plus any accrued and unpaid interest and additional interest, if any, to the redemption date, if redeemed during the 12-month period beginning on April 1 of the years indicated below.

Year	Price
2014	105.813	%
2015	103.875	%
2016	101.938	%
2017 and thereafter	100.000	%

If a change of control of MEMC occurs, each holder of the 2019 Notes will have the right to require us to repurchase all or any part of that holder's notes at a purchase price of 101% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, to the date of the repurchase.

The 2019 Notes are guaranteed by certain of MEMC's domestic subsidiaries (the “guarantors”). The 2019 Notes are senior unsecured obligations and are subordinated to all of our and the guarantors' existing and future secured debt.

The indenture governing the 2019 Notes contains covenants that limit our and our subsidiaries' ability, subject to certain exceptions and qualifications, (i) to make certain asset sales, (ii) to make other restricted payments and investments, (iii) to incur indebtedness and issue preferred stock, (iv) to declare dividends, (v) to make other payments affecting restricted subsidiaries, (vi) to enter into certain transactions with affiliates, and (vii) to merge, consolidate or sell substantially all of our assets. These covenants are subject to a number of qualifications and limitations, and in certain situations, a cross default provision.

In addition, the indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among other things: failure to make payments on the 2019 Notes when due, failure to comply with covenants under the indenture, failure to pay other indebtedness or acceleration of maturity of other indebtedness, failure to satisfy or discharge final judgments and occurrence of bankruptcy events. As of December 31, 2012, we were in compliance with all covenants in the indenture governing the 2019 Notes.

Revolving Credit Facility

Our corporate revolving credit facility with Bank of America, N.A. has an aggregate principal amount of $400.0 million (the “Credit Facility”).

The Credit Facility has a term of three years and expires in March of 2014. Our obligations under the facility are guaranteed by certain domestic subsidiaries of MEMC. Our obligations and the guaranty obligations of the subsidiaries are secured by liens on and security interests in substantially all present and future assets of MEMC and the subsidiary guarantors, including a pledge of the capital stock of certain domestic and foreign subsidiaries of MEMC.

Interest under the Credit Facility will accrue, depending on the type of borrowing, at the base rate (in the case of base rate loans and swing line loans) or the eurocurrency rate (in the case of eurocurrency rate loans), plus, in each case, an applicable rate that varies from (currently 3.75%) for the eurocurrency rate to (currently 2.75%) for the base rate, depending on our consolidated leverage ratio. Interest is due and payable in arrears at the end of each interest period (no less than quarterly) and on the maturity date of the Credit Facility. Principal is due on the maturity date. Commitment fees of 0.50% are payable quarterly on the unused portion of the aggregate commitment of $400 million. Letter of credit fees are payable quarterly on the daily amount available to be drawn under a letter of credit at an applicable rate that varies (currently 2.75%), depending on our consolidated leverage ratio.

On February 28, 2012, we amended our Credit Facility to reduce our expected minimum liquidity covenant of $500 million to $450 million and $350 million for the first and second quarters of 2012, respectively.

On May 8, 2012, we further amended our Credit Facility to allow for a consolidated leverage ratio of not greater than 3.0 to 1.0 for the second and third quarters of 2012 and to set our minimum liquidity covenant at $400 million for the third quarter of2012. In the fourth quarter of 2012, our consolidated leverage ratio covenant reverted back to 2.5 to 1.0, and our minimum liquidity covenant under this facility will require a minimum liquidity amount based on our trailing twelve month consolidated EBITDA. Our minimum liquidity covenant amount will be $500 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $400 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $300 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. The interest rates on borrowings under the Credit Facility were also amended to the eurocurrency rate plus 3.75% and the base rate plus 2.75%, as applicable. The Credit Facility was also amended to permit us to incur up to $250 million of convertible or subordinated unsecured indebtedness, subject to compliance with certain conditions.

In order to accommodate the Term Loan described below, the Credit Facility was further amended on September 28, 2012. We incurred $2.0 million in debt issuance costs, which is amortized into the condensed consolidated statement of operations and comprehensive (loss) income over the remaining term of the Credit Facility. There were no changes to the maximum capacity or stated interest rate as part of the amendment, although the Credit Facility lenders and Term Loan lenders entered into a customary intercreditor agreement.

The Credit Facility contains representations, covenants and events of default typical for credit arrangements of comparable size, including maintaining a consolidated leverage ratio and a variable minimum liquidity amount.  The Credit Facility also contains a customary material adverse effects clause and a cross default clause. The cross default clause is applicable to defaults on other indebtedness in excess of $35.0 million, excluding our non-recourse indebtedness. Our liquidity position was in excess of the minimum liquidity amount by $350.7 million and our consolidated leverage ratio was 1.8 at December 31, 2012.

During 2012 and 2011 we had no borrowings outstanding under this facility, although we had approximately $121.8 million and $173.0 million, respectively, of outstanding third party letters of credit backed by this facility at each year end, which reduces the available capacity.  Therefore, funds available under this facility were $278.2 million and $227.0 million as of December 31, 2012 and December 31, 2011, respectively. We were in compliance with all covenants under this facility at December 31, 2012.

Long-term Notes

Long-term notes at December 31, 2012 totaling $16.0 million are owed to a bank by our Japanese subsidiary, are guaranteed by MEMC, and are secured by the property, plant and equipment of our Japanese subsidiary. These loans mature in years ranging from 2013 to 2017. The guarantees would require us to satisfy the loan obligations in the event that the Japanese subsidiary failed to pay such debt in accordance with its stated terms.

Second Lien Term Loan Credit Agreement

During the third quarter of 2012, we entered into a Second Lien Credit Agreement ("Term Loan") with Goldman Sachs Bank USA and Deutsche Bank Securities Inc. providing for a term loan maturing on October 2, 2017, in an aggregate principal amount of $200.0 million, with a 2.0% discount to par for proceeds of $196.0 million. Additionally, we incurred $10.8 million in debt issuance costs, which are amortized into the condensed consolidated statement of operations and comprehensive (loss) income over the 5 year term. Interest under the Term Loan will accrue, depending on the type of borrowing, at the base rate or the eurocurrency rate, with a floor of 1.50%, plus an applicable rate equal to 9.25% for the eurocurrency rate and 8.25% for the base rate. Interest is due and payable in arrears at the end of each interest period, no less than quarterly, and on the maturity date. As of December 31, 2012, the current interest rate on the Term Loan is 10.75%.

The obligations under the Term Loan are guaranteed by certain of our domestic subsidiaries pursuant to a guaranty agreement executed by each such subsidiary. Our obligations and the guaranty obligations of the subsidiaries are secured by second priority liens on and security interests in substantially all of our present and future assets and the assets of the subsidiary guarantors, including a pledge of the capital stock of domestic and foreign subsidiaries.

We may elect to prepay amounts due under the Term Loan with prior notice to the administrative agent. Any voluntary prepayments made on or prior to March 31, 2014 are subject to yield maintenance payments to the lenders in an amount not less than 3.0% of the principal amount then being prepaid. Voluntary prepayments made after March 31, 2014 but on or prior to March 31, 2015 are subject to a call premium of 3.0% of the principal amount then being prepaid. The call premium reduces to1.0% for prepayments made after March 31, 2015 but on or prior to March 31, 2016. We may make prepayments after March 31, 2016 without penalty.

Similar to the revolving Credit Facility with Bank of America, N.A. (discussed above), the Term Loan contains affirmative and negative covenants. These include but are not limited to limiting the company's and certain of our subsidiaries' ability, subject to certain exceptions and qualifications, to (i) create, incur, assume or suffer any liens on assets or revenues, (ii) make other restricted payments and investments, (iii) incur indebtedness, (iv) make certain transactions with affiliates, (v) merge, consolidate or sell/dispose of assets, (vi) enter into burdensome agreements, (vii) engage in any material line of business different from current lines, or (viii) prepay indebtedness or amend indebtedness that aversely impacts the Term Loan lenders. These covenants are subject to a number of qualifications and limitations.

Additionally, the Term Loan has financial covenants requiring a consolidated leverage ratio of 3.0 to 1.0 on December 31, 2012 and minimum liquidity levels depending on our trailing twelve-month consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA). Our minimum liquidity covenant amount will be $400 million in the event our trailing twelve month consolidated EBITDA is less than $400 million. In the event the trailing twelve month consolidated EBITDA is greater than or equal to $400 million and less than $600 million, our minimum liquidity amount will be $300 million. In the event it is greater than or equal to $600 million and less than $850 million, our minimum liquidity will be $200 million. Finally, if our trailing twelve month consolidated EBITDA is greater than or equal to $850 million, then no minimum liquidity amount is required. As of December 31, 2012, we were in compliance with all covenants of the Term Loan.

Solar Energy System Debt, Financings and Capital Leaseback Obligations

Our solar energy systems for which we have short-term and long-term debt, capital leaseback and finance obligations are included in separate legal entities. Of this total debt outstanding, $1,562.9 million relates to project specific non-recourse financing that is backed by solar energy system operating assets. This debt has recourse to those separate legal entities but no recourse to MEMC or SunEdison under the terms of the applicable agreements. The recourse finance obligations above are fully collateralized by the related solar energy system assets. These obligations may also include limited guarantees by MEMC or SunEdison related to operations, maintenance and certain indemnities.

Short–term Debt

On September 30, 2011, SunEdison amended and restated its non-recourse project construction financing revolver, which has a term of three years, from $50.0 million to $300.0 million. Interest on borrowings under the agreement will be based on our election at LIBOR plus an applicable margin (currently 3.50%) or at a defined prime rate plus an applicable margin (currently 2.50%). The construction financing revolver also requires SunEdison to pay various fees, including a commitment fee (currently 1.10%). The construction financing revolver will be used to support the construction costs of utility and rooftop solar energy systems throughout the U.S. and Canada. The construction loans are non-recourse debt to entities outside of the project company legal entities that subscribe to the debt and is secured by a pledge of the collateral, including the project contracts and equipment. This revolver also includes a customary material adverse effects clause whereby a breach may disallow a future draw but not acceleration of payment. This revolver also maintains a cross default clause whose remedy, among other rights, includes the right to restrict future loans as well as the right to accelerate principal and interest payments. Because this is non-recourse financing, covenants relate specifically to the collateral amounts and transfer of right restrictions.

During 2012, due to various amendments and lenders entering and exiting the facility, the non-recourse construction financing revolver capacity was lowered from $300.0 million to $150.0 million. Under the terms of the amendments, if our Corporate Family or Corporate Credit Rating for Moody's Investors Service ("Moody's") falls below "B1" or our Standard and Poor ("S&P") rating falls below "B+", we will be required to post, at our election, a letter of credit or surety bond equal to 15.0% of the total outstanding balance in order to continue to make additional borrowings under this facility. As of December 31, 2012, our ratings were "B3" and "BB" for Moody's and S&P respectively. Because our Corporate Family Rating for Moody's was below "B1", a letter of credit equal to 15.0% of the $7.4 million outstanding balances was posted as of December 31, 2012. Additionally, $3.9 million of deferred financing fees were charged to interest expense during the second quarter of 2012, as a result of the amendments made to our non-recourse project construction financing revolver. No similar charges were incurred in the comparable period of 2011 or 2010.

As of December 31, 2012 and December 31, 2011, there was $7.4 million and $77.2 million, respectively, outstanding on this construction revolver.

In the event additional construction debt is needed and the remainder of the original capacity is not renewed or replaced, we have the ability to draw upon the available capacity of our revolving credit facility (discussed above). In the event we cannot renew, replace or backfill the remainder of the original capacity with other financing or have adequate net working capital, such inability to fund future projects may have an adverse impact on our business growth plans, financial position and results of operations.

System Construction and Term Debt

SunEdison typically finances its solar energy projects through project entity specific debt secured by the project entity's assets (mainly the solar energy system) with no recourse to MEMC or SunEdison. Typically, these financing arrangements provide for a construction loan, which upon completion will be converted into a term loan, and generally do not restrict the future sale of the project entity to a third party buyer. On December 31, 2012, SunEdison had system construction and term debt outstanding of $271.3 million.Of this amount, $188.7 million relates to variable rate debt with interest rates that are tied to either the London Interbank Offered Rate, the Euro Interbank Offer Rate, the Canadian Dollar Offered Rate or the PRIME rate. The variable interest rates have primarily been hedged by our outstanding interest rate swaps as discussed in Note 5. The interest rates on the remaining construction and term debt range from 3.0% to 12.0%. The maturities range from 2013 to 2033 and these facilities are collateralized by the related solar energy system assets with a carrying amount of $80.5 million.

During the second quarter of 2012, we violated covenants of two non-recourse solar energy system loans totaling $24.1 million as a result of the devaluation of the local currency (Indian Rupee). On September 28, 2012, we obtained a waiver from the lender for the covenant violations, which has a grace period until November 20, 2013. During the grace period, the debt will be classified as short-term debt.  We can make no assurances that the covenants will be met after the grace period. The solar energy systems for these two project companies collateralize the loans and there is no recourse outside of these project companies.

Capital Leaseback Obligations

We are party to master lease agreements that provide for the sale and simultaneous leaseback of certain solar energy systems constructed by us. On December 31, 2012, SunEdison had $93.3 million of capital lease obligations outstanding. Generally, this classification occurs when the term of the lease is greater than 75% of the estimated economic life of the solar energy system and the transaction is not subject to real estate accounting. The terms of the leases are typically 25 years with certain leases providing terms as low as 10 years and providing for early buyout options. The specified rental payments are based on projected cash flows that the solar energy system will generate. Since the SunEdison acquisition date on November 20, 2009, SunEdison has not entered into any arrangements that have resulted in accounting for the sale leaseback as a capital lease.

Financing Leaseback Obligations

As more fully described in Note 2, Revenue Recognition - Financing arrangements, in certain transactions we account for the proceeds of sale leasebacks as financings, which are typically secured by the solar energy system asset and its future cash flows from energy sales, but without recourse to MEMC or SunEdison under the terms of the arrangement. The structure of the repayment terms under the lease results in negative amortization throughout the financing period, and we therefore recognize the lease payments as interest expense. The balance outstanding for sale leaseback transactions accounted for as financings as of December 31, 2012 is $1,107.2 million, which includes the below mentioned transactions. The maturities range from 2021 to 2037 and are collateralized by the related solar energy system assets with a carrying amount of $1,105.8 million.

On March 31, 2011, one of SunEdison's project subsidiaries executed a master lease agreement with a U.S. financial institution which provides for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. The total capacity under this agreement is $120.0 million, of which $68.0 million is outstanding and $52.0 million is available as of December 31, 2012. The specified rental payments will be based on projected cash flows that the solar energy systems will generate.

On September 24, 2012, one of SunEdison's project subsidiaries executed a master lease agreement with a U.S. financial institution which provides for the sale and simultaneous leaseback of certain solar energy systems constructed by SunEdison. The total capacity under this agreement was $52.5 million, of which $26.9 million is outstanding and $25.6 million was available as of December 31, 2012. The specified rental payments will be based on projected cash flows that the solar energy systems will generate.

Other System Financing Transactions

Other system financing transactions represent the cash proceeds that SunEdison received in connection with an executed solar energy system sales contract that has not met the sales recognition requirements under real estate accounting and has been accounted for as a financing. Included in other system financing is $17.6 million of proceeds collected under three separate solar energy system sales agreements with the buyer that provides the buyer with a put option that could become an obligation in the event that we are unable to fulfill certain performance warranties set to expire during 2015. The remaining portion of other system financings of $102.1 million relates to cash proceeds received in connection with separate solar energy system sales contracts for which SunEdison has substantial continuing involvement. There are no principal or interest payments associated with these transactions. Of the $102.1 million, $39.5 million relates to two projects sold in Italy which did not meet the requirements to record revenue due to an indemnification that expires in 2016. The remaining amount relates to six projects sold in the United States, Korea, and Canada.

Other Facilities

Other Financing Commitments

We have short-term committed financing arrangements of approximately $32.3 million at December 31, 2012, of which there were no short-term borrowings outstanding as of December 31, 2012. Of this amount, $13.5 million is unavailable because it relates to the issuance of third party letters of credit. Interest rates are negotiated at the time of the borrowings.

During the years ended December 31, 2012 and 2011, we capitalized $19.9 million and $18.1 million of interest to the consolidated balance sheet, respectively.

Maturities

The aggregate amounts of payments on long-term debt, excluding financing leaseback obligations, after December 31, 2012 are as follows:

	2013		2014		2015		2016		2017		Thereafter		Total
In millions
Maturities of long-term debt (a)	$	64.6	$	30.8	$	28.6	$	51.0	$	206.7	$	771.2	$	1,152.9

(a) Included in maturities of long-term debt is $119.7 million of maturities relating to other system financing transactions that represent the contract price for solar energy systems under existing sales contracts that contain certain contractual provisions that preclude sale treatment under real estate accounting rules. We account for these transactions as financings of $17.6 million and $102.1 million that will mature upon the expiration of the contractual provisions that preclude sale treatment in years 2015 and thereafter, respectively. These could become payment obligations in the event we default under the executed sales agreement, and the buyer may execute its contractual option to put (sell) the project back to SunEdison for a full refund of the contract price.

The aggregate amounts of payments on capital leases after December 31, 2012 are as follows:

In millions
2013	$	9.8
2014	6.6
2015	5.3
2016	5.7
2017	5.8
Thereafter	90.9
Total minimum lease payments	124.1
Less amounts representing interest	(30.8		)
Present value of minimum lease payments	93.3
Less current portion of obligations under capital leases	(7.5		)
Noncurrent portion of obligations under capital leases	$	85.8

The aggregate amounts of minimum lease payments on our financing leaseback obligations are $890.2 million. Payments from 2013 through 2017 are as follows:

In millions	2013		2014		2015		2016		2017
Minimum lease payments	$	60.5	$	48.5	$	46.4	$	42.9	$	40.9

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Commitments and Contingencies (Details) In Millions, unless otherwise specified	12 Months Ended				0 Months Ended		3 Months Ended			12 Months Ended		12 Months Ended				12 Months Ended			3 Months Ended	6 Months Ended
	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2012 Contract Termination [Member] USD ($)	Sep. 04, 2012 Purchase Obligation Termination [Member] USD ($) quarter claim	Sep. 04, 2012 Purchase Obligation Termination [Member] EUR (€)	Dec. 31, 2012 Purchase Obligation Termination [Member] EUR (€)	Sep. 30, 2012 Purchase Obligation Termination [Member] EUR (€)	Dec. 31, 2012 Purchase Obligation Termination [Member] USD ($)	Dec. 31, 2012 Solaicx [Member] USD ($) amount	Jun. 30, 2011 Solaicx [Member] USD ($)	Dec. 31, 2012 Solaicx [Member] Maximum [Member] USD ($)	Dec. 31, 2012 Solaicx [Member] Minimum [Member] USD ($)	Dec. 31, 2012 SunEdison [Member] USD ($) entity	Feb. 01, 2011 SunEdison [Member]	Dec. 31, 2012 Inventories [Member] USD ($)	Dec. 31, 2011 Inventories [Member] USD ($)	Dec. 31, 2010 Inventories [Member] USD ($)	Sep. 30, 2011 Other Income [Member] USD ($)	Dec. 31, 2011 Other Income [Member] USD ($)	Dec. 31, 2012 Subsequent Event [Member] SunEdison [Member] USD ($)	Jul. 06, 2012 Subsequent Event [Member] SunEdison [Member] USD ($)
Loss Contingencies [Line Items]
Contingent Consideration Paid In Cash																					$ 13.6	$ 66.4
Business acquisition, contingent consideration	24.9										(26.0)
Business Acquisition, Contingent Consideration, at Fair Value, Current	23.1	71.6									26.0
Business Acquisition, Contingent Consideration, at Fair Value, Noncurrent	1.8
Contingent consideration paid in cash											75.7
Contingent Consideration Common Stock Issued															2.1
Amount payable based on achieving revenues												71.8	60.0
Number Of Target Revenue Amounts										2
Additional payment combination of cash and common stock										27.6
Business Combination, Contingent Consideration Arrangements, Change in Range of Outcomes, Contingent Consideration, Liability, Value, High	12.8	26.3
Number of Businesses Acquired														3
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High	67.1										71.8			39.5
Operating Leases, Rent Expense, Net	23.6	17.6	10.5
Operating Leases, Future Minimum Payments Due [Abstract]
Total	96.3
2012	25.3
2013	22.2
2014	19.8
2015	13.3
2016	7.3
Thereafter	8.4
Operating Leases, Future Minimum Payments Due, Noncancellable	90.1
Cost of Goods Sold	2,194.3	2,420.6	1,902.1													5.5	37.4	5.7
Restructuring Reserve				134.5
Restructuring Reserve, Current									69.4
Restructuring Reserve, Noncurrent									65.1
Loss Contingency, Range of Possible Loss, Maximum									225
Loss Contingency, Claims Settled, Number					2	2
Litigation Settlement, Gross						70.0
Payments for Legal Settlements							15.0	10.0
Litigation Settlement, Payment Installment Period, Number of Quarters					3	3
Increase (Decrease) in Other Noncurrent Assets					(10.2)
Gain on Receipt of Property Plant and Equipment	31.7	0	0
Refundable deposits	0.3	0.3
Sale Lease Back Transaction Additional Payments Under The Terms Of Lease Agreements For Indemnification	18.4
Guaranteed the uptime availability of the system over the term of the arrangement, years														20 years
Marketing and administration	306.2	352.8	267.0
Foreign Currency Cash Flow Hedge Gain (Loss) Reclassified to Earnings, Net																				14.2
Gain (Loss) on Foreign Currency Derivatives Recorded in Earnings, Net																			$ (6.6)