EXHIBIT 10.37
SUPPLY AGREEMENT
between Wacker Chemie AG
Hanns-Seidel-Platz 4
81737 Munich
Federal Republic of Germany
- hereinafter referred to as "WACKER" -
and Tianwei Yingli New Energy Resources Co.Ltd
No. 3055 Middle Fuxing Road
Bao Ding City
P.R.China (071051)
- hereinafter referred to as "BUYER" -
PREAMBLE
BUYER has requirements for polycrystalline Silicon. WACKER is willing to
supply BUYER with polycrystalline Silicon.
Now, therefore, in consideration of the foregoing and the mutual premises
hereinafter contained, WACKER and BUYER agree as follows:
1. PRODUCT
WACKER agrees to sell and deliver and BUYER agrees to purchase and take the
polycrystalline Silicon manufactured by WACKER as defined per specification
set forth in APPENDIX A (hereinafter referred to as "PRODUCT").
2. QUANTITIES
2.1 The BUYER shall make the agreed prepayment according to the payment
schedule set forth in APPENDIX A.
WACKER shall sell and deliver to BUYER and BUYER will purchase and take
from WACKER the annual quantities of PRODUCT set forth in APPENDIX A.
3. PRICES / PAYMENT TERMS
3.1 The prices for the PRODUCT are set forth in APPENDIX A.
3.2 The prices under Section 3.1 above shall be firm until 31.12.2011 and
only subject to change, if the relevant energy price index, defined in
APPENDIX C, increases or decreases by more than 20%. The agreed prices
will be adjusted by the rate (Euro/kg) as specified in the table in
APPENDIX C.
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3.3 WACKER shall invoice BUYER with each shipment of PRODUCT. BUYER shall
pay such invoices net within [-]* ([-]*) days from the date of such
invoices.
4. DELIVERY
4.1 PRODUCT shall be delivered FOB German seaport (Incoterms 2000).
4.2 All deliveries of PRODUCT are subject to WACKER's General Conditions of
Sale set forth in APPENDIX B and hereby made part of this Agreement,
provided, however, that if there is any conflict between the terms of
this Agreement and the said Conditions of Sale the terms of this
Agreement shall prevail.
4.3 The agreed annual quantities for the years 2009, 2010 and 2011 will be
shipped in about equal monthly installments.
5. QUALITY / INSPECTION AND TESTING
5.1 The PRODUCT supplied by WACKER shall conform to the specifications set
forth in APPENDIX A.
5.2 It is understood and expressly agreed that the PRODUCT delivered by
WACKER hereunder are PRODUCTS of technical quality only and BUYER is
exclusively responsible for fitness for purpose, handling, use and
application of the PRODUCT.
5.3 Upon receipt of each shipment of PRODUCT BUYER shall inspect the
PRODUCT. Unless BUYER notifies WACKER within [-]* ([-]*) days after the
arrival of the shipment at Buyer's premises or warehouse, that it does
not conform to the quantity ordered or WACKER's certificate of quality
does not conform to the specifications set forth in APPENDIX A, said
shipment shall be deemed to have been delivered as ordered and WACKER's
certificate of quality shall be deemed to conform to the specifications.
6. WARRANTY / LIABILITY
6.1 WACKER warrants solely that the PRODUCT delivered shall conform to the
specifications set forth in APPENDIX A. Except for the warranty
provided above, WACKER disclaims any and all other express or implied
warranties with respect to the PRODUCT, and any warranty of
merchantability or fitness for a particular purpose is expressly
disclaimed.
6.2 BUYER's exclusive remedy and WACKER's sole obligation for any claim or
cause of action arising under this Agreement because of defective
PRODUCT is expressly limited to either (i) the replacement of
non-conforming PRODUCT or the repayment of the purchase price of the
respective quantity of PRODUCT; OR (ii) payment not to exceed the
purchase price of the specific quantity of PRODUCT for which damages
are claimed.
- ----------
* INFORMATION INTENTIONALLY OMITTED; CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR SUCH INFORMATION, AND SUCH INFORMATION HAS BEEN SEPARATELY
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
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Any remedy is subject to BUYER giving WACKER notice as provided for in
Section 5.3.
6.3 The parties agree that the remedies provided in this Agreement are
adequate and that except as provided for above, neither party shall be
liable to the other, whether directly or by way of indemnity or
contribution for special, incidental, consequential or other damages
arising from the breach of any obligation hereunder or for any other
reason whatsoever, including actions for tort, strict or product
liability, patent or trademark infringement except as provided for
herein.
7. CONFIDENTIALITY
7.1 BUYER may use all the information disclosed by WACKER under this
Agreement only for the purposes contemplated herein.
7.2 BUYER agrees to keep secret such information and to take the necessary
measures to prevent any disclosure to third parties.
7.3 BUYER is responsible for assuring that secrecy is maintained by its
employees and agents.
7.4 The secrecy obligation does not apply to information
- where BUYER can prove that is or was known to BUYER prior to its
receipt;
- which is or has become generally available to the public prior to
its receipt;
- which is or has become generally available to the public without
being the result of a breach of this Agreement;
- which is in accordance with information BUYER received or got access
to from an entitled person without any obligation of secrecy;
- where WACKER approved the disclosure in a particular case in writing.
7.5 The secrecy obligation shall survive the term of this Agreement.
8. SECURITY INTEREST
BUYER hereby grants WACKER a continuing security interest in any
PRODUCT and in the proceeds (including proceeds of sale or insurance)
until the entire purchase price for the PRODUCT currently or previously
sold to BUYER is paid and until all late payment interest, legal fees
and expenses required to enforce WACKER's rights and any costs,
expenses, taxes or other charges required to be paid by BUYER to WACKER
have been paid in full. BUYER specifically agrees that WACKER may file
one or more financing statements or other documents and take all
necessary or appropriate in order to create, perfect, preserve or
enforce WACKER's security interest in the PRODUCT pursuant to the
Uniform Commercial Code and other applicable law, and hereby grants to
WACKER a power of attorney to execute such statements or documents in
BUYER's name. WACKER's reasonable costs and expenses (including, but
not limited to, attorney's fees and expenses for pursuing, searching
for, receiving, taking, keeping, storing, advertising and selling the
PRODUCT shall be paid by BUYER who shall remain liable for any
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deficiency resulting from a sale of the PRODUCT and shall pay any
deficiency forthwith on demand. The requirement of reasonable notice of
sale shall be met if such notice is mailed and addressed to BUYER at
its last address appearing on WACKER's records at least 30 days prior
to the date of sale.
9. FORCE MAJEURE
9.1 If either party should be prevented or restricted directly or
indirectly by an event of Force Majeure as hereinafter defined from
performing all or any of its obligations under this Agreement, the
party so affected will be relieved of performance of its obligations
hereunder during the period that such event and its consequences will
continue, but only to the extent so prevented, and will not be liable
for any delay or failure in the performance or any of its obligations
hereunder or loss or damage whether direct, general, special or
consequential which the other party may suffer due to or resulting from
such delay or failure, provided always that prompt notice is given by
the affected party to the unaffected party by facsimile or telephone of
the occurrence of the event constituting the Force Majeure, together
with details thereof and an estimate of the period of time for which it
will continue.
9.2 The term Force Majeure shall include without limitation strike, labor
dispute, lock out, fire, explosion, flood, war (accident), act of god
or any other cause beyond the reasonable control of the affected party,
whether similar or dissimilar to the causes enumerated above.
10. ASSIGNMENT
This Agreement or any part thereof is not assignable by either party
without the prior written consent of the other party.
11. ENTIRE AGREEMENT
11.1 This Agreement constitutes the whole agreement between the parties as
to the subject matter thereof and no agreements, representations or
warranties between the parties other than those set out herein are
binding on the parties.
11.2 No waiver, alteration, or modification of this Agreement shall be valid
unless made in writing and signed by authorized representatives of the
parties.
12. SEVERABILITY
In the event, any provision of this Agreement shall be declared
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
13. HEADINGS
The headings of the articles of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this
Agreement or to affect the construction hereof.
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14. DURATION / TERMINATION
14.1 This Agreement will commence on the 01.10.2007 and will endure for a
defined period of 4 (four) years and 3(three) month.
15. APPLICABLE LAW / JURISDICTION
This Agreement shall be construed and the legal relations between the
parties hereto shall be determined in accordance with the laws of
Germany; the application of the 1980 United Nations Convention on
Contracts for the International Sale of Goods is expressly excluded.
Exclusive place of jurisdiction shall be Munich.
Wacker Chemie AG Tianwei Yingli New Energy Resources Co. Ltd
WACKER POLYSILICON
Date: September 3, 2007 September 5, 2007
/s/ Ewald Schindlbeck /s/ Reimund Huber /s/ Liansheng Miao
- -------------------------------------------------- -------------------------------------------
Ewald Schindlbeck Reimund Huber
President Director Marketing & Sales
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APPENDIX A
SOLARQRADE POLYSILICON
SPECIFICATION PCL-NCS (B)
<Table>
<Caption>
Price EURO/kg
Calendar year Annual quantity (kg) FOB German Seaport
2009 [-]* [-]*
2010 [-]* [-]*
2011 [-]* [-]*
</Table>
PREPAYMENT SCHEDULE
The BUYER will prepay the amount of [-]* Euro/kg for the total above agreed
contract quantity. The invoices, regarding deliveries up to the annual agreed
quantity, will be reduced by [-]* Euro/kg with each shipment. So WACKER's
invoice will state the above agreed prices on the invoice, but will make
note, that the BUYER has only to pay the invoice amount reduced by [-]*
Euro/kg.
Regarding to the agreed annual quantities the total prepayment amount of Euro
[-]* ([-]*) has to be paid according to the following schedule on the account
of Wacker Chemie AG:
October 30th, 2007 Euro [-]* ([-]*)
In case the BUYER does fail to take the full amount of the agreed annual
quantity in one respective calendar year, WACKER does not have to repay the
not absorbed outstanding prepayment (regarding the respective calendar year),
BUYER also doesn't have the right to set this prepayment against deliveries
of the following year.
- ----------
* INFORMATION INTENTIONALLY OMITTED; CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR SUCH INFORMATION, AND SUCH INFORMATION HAS BEEN SEPARATELY
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
7
APPENDIX B
GENERAL CONDITIONS OF SALE
1. GENERALLY:
All our supplies and services as well as all contracts concluded with us are
exclusively subject to the following conditions of sale. Terms of the
Purchaser which contradict or which deviate from our sales terms and which
are not expressly recognised by us are not valid even if we do not expressly
object to them. Where a continuing business relationship exists, all future
contracts, supplies and services are also subject to our conditions of sale.
2. OFFER, CONCLUSION OF CONTRACT:
Our offers are subject to change and non-binding. Orders are only valid if
confirmed by us in writing or if recognised by us through the act of
delivery. Any additional verbal agreements, supplements and modifications
are also only valid if confirmed in writing.
3. DELIVERY, DEFAULT:
3.1 Unless otherwise agreed, any dates quoted for delivery are non-binding.
3.2 We are entitled to make partial deliveries as far as the Purchaser must
reasonably accept this in the circumstances of an individual case. The
corresponding invoices issued are payable without regard to whether
complete delivery has been made.
3.3 In the event delivery is delayed, the Purchaser may set us a reasonable
grace period with the notice that he rejects the acceptance of the
delivery item after expiry of the grace period. After the expiry of
the grace period, the Purchaser is entitled to cancel the contract of
sale through written notice or to request damages instead of
performance.
At our request the Purchaser is obligated to state within a reasonable
period whether he cancels the contract due to delay in delivery, seeks
damages instead of performance or insists on performance.
3.4 Our liability is set forth in para. 9. Furthermore in the event of
slight negligence, our liability is limited to the invoice value of the
respective delivery item.
4. RETURN OF LOAN PACKAGING:
In the event of delayed return (meaning in the event normal uploading times
are exceeded) of loading equipment, loading banks and other loan packaging we
reserve the right to charge the Purchaser for the costs incurred by us.
5. PRICES:
5.1 Unless otherwise expressly agreed, prices are quoted "ex works"
excluding packaging and plus delivery and shipping costs as well as
plus any applicable Value Added Tax.
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5.2 The prices valid on the day of dispatch shall apply.
Should the latter be higher than the contractual price, the Purchaser is
entitled to cancel the contract with regard to the quantities still to be
delivered. Cancellation shall be made within 14 days after notification of
said price increase.
6. PAYMENT:
6.1 The payment shall be made in Euro to one of our bank accounts indicated
on the reverse side.
6.2 Should Purchaser be in arrears with payment, interest for default shall
be due and payable at 12%, but at least 8% above the respective base
interest rate. We reserve the right to claim further damages. If the
interest we claim is higher than the statutory interest for delayed
payment, the Purchaser has the right to demonstrate lower damages just
as we have the right to show that greater damages were incurred.
6.3 Should Purchaser be in arrears with payment or should there be
reasonable doubts as to Purchaser's solvency or credit rating, we are
-- without prejudice to our other rights -- entitled to require payment
in advance for deliveries not yet made, and to require immediate
payment of all our claims arising from the business relation.
6.4 Bills of exchange and cheques shall be accepted upon separate agreement
and only by way of payment. All expenses incurred in this regard shall
be borne by the Purchaser.
6.5 Only uncontested or legally proved claims shall entitle the Purchaser
to set-off or withhold payment.
7. FORCE MAJEURE:
Events of Force Majeure, in particular strikes, lock outs, operation or
transport interruptions, including at our suppliers, shall suspend the
contractual obligations of each party for the period of the disturbance and
to the extent of its effects. Should the delays caused exceed a period of 6
weeks, both parties shall be entitled to cancel the contract, with respect to
the contractual performance affected by such delays. No other claims exist.
8. QUALITY:
8.1 All our data, especially data relating to product suitability,
processing and use, as well as to technical support, have been compiled
to the best of our knowledge. The Purchaser, however, must still
perform his own inspections and preliminary trials.
8.2 The Purchaser undertakes to examine the goods immediately after
delivery with respect to any defects concerning quality and suitability
of purpose and object to ascertainable defects. Sample testing shall
also be performed if this can be reasonably expected of the Purchaser.
Failure to proceed in aforesaid manner shall result in the goods being
regarded as accepted.
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8.3 Complaints must be made within 8 days after receipt of the goods. In
case of hidden faults, however, complaints are to be made immediately
on discovery, within one year after receipt at the very latest. Said
claims shall only be taken into consideration if and when made in
writing and with the relevant documentation attached. To comply with
the time limit it shall be sufficient if the complaint is sent in good
time.
8.4 We are not liable on the basis of public statements by us, the
manufacturer or his agents, if we were not aware of the statement or
were not required to have knowledge thereof, the statement was already
corrected at the time of the purchase decision or the Purchaser cannot
show that the statement influenced his purchase decision.
8.5 We are not liable for defects which only marginally reduce the value or
the suitability of the object. A marginal defect exists in particular
if the defect can be removed by the Purchaser himself with
insignificant effort.
8.6 If the Purchaser requests replacement performance due to a defect, we
may choose whether we remove the defect ourselves or deliver a
defect-free object as a replacement. The right to reduce the price or
cancel the contract in the event of unsuccessful replacement
performance shall remain unaffected.
8.7 Where complaints are justified, the goods may only be returned to us at
our expense if after we receive notice of the defect we do not offer to
collect or dispose of the goods.
8.8 If increased costs arise because the Purchaser has transferred the
goods to a place other than his commercial place of business, we shall
charge the Purchaser for the increased costs in connection with the
remedying of the defect, unless the transfer corresponds to the
designated use of the object.
8.9 Damage and claims for reimbursement of expenses shall remain unaffected
as far as not excluded by para. 9.
8.10 All claims due to a defect are subject to a limitation period of one
year after delivery of the object. No warranty is made for used
objects. The statutory limitation period for objects which are used
for a building structure in accordance with their usual manner of use,
and which cause the defectiveness thereof, shall remain unaffected.
8.11 The rights of the Purchaser under Sections 478, 479 German Civil Code
remain unaffected.
9. LIABILITY:
Our liability is excluded, regardless of the legal grounds.
This shall not apply in the event of intentional actions or gross negligence
by us or our legal representatives or agents or in the event of breach of
material contractual duties.
In the event of a slightly negligent breach of material contractual duties,
our liability is limited to twice the invoice value of the respective
delivery item. For damages due to delayed performance para. 3.4 shall also
apply. Our liability for damages due to injury to life, the body or health,
the
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liability based on a guarantee and under mandatory statutory provisions, in
particular the Product Liability Act, remain unaffected.
10. RESERVATION OF OWNERSHIP:
10.1 The goods that have been sold remain our sole property until all
outstanding debts arising from the business connection with the
Purchaser have been paid in full. The Purchaser has power of disposal
of the purchased goods in the ordinary course of business, or he may
process the goods until revocation by us.
10.2 Reservation of ownership and power of disposal, as laid down in clause
10.1, also apply to the full value of the manufactured goods produced
by processing, mixing and blending or combining our goods. In each
case we qualify as the manufacturer. In cases where the goods are
processed, mixed and blended or combined with those of a third party,
and where the reservation of the latter continues to apply, then we
acquire joint ownership in proportion to the invoice value of those
processed goods. If security rights of a third party are in fact or in
law below that share, the difference will be to our benefit.
10.3 If the Purchaser resells our goods to third parties he hereby assigns
the entire resulting payment claim -- or in the amount of our joint
share therein (see para. 10.2) -- to us. In the event the parties
agree on a current account, the respective balance amounts shall be
assigned. However, the Purchaser shall be entitled to collect such
payment claim on our behalf until we revoke such right or until his
payments are discontinued. The Purchaser is only authorized to make
assignment of these claims -- even only for the purpose of collection
by way of factoring -- with our express written consent.
10.4 The Purchaser shall immediately give notice to us if any third party
raises any claim with respect to such goods or claims which are owned
by us.
10.5 If the value of the collateral exceeds our accounts receivable by more
than 20% then we will release collateral on demand and at our
discretion.
10.6 We are also entitled to take back goods on the basis of the reservation
of title, even if we have not previously cancelled the contract. If
products are taken back by way of the exercise of the reservation of
ownership, this shall not constitute cancellation of the contract.
10.7 If the laws of the country in which the goods are located after
delivery do not permit the Vendor to retain the title to said goods,
but allow the retention of other similar rights to the delivery item,
the Purchaser shall provide us with such other equivalent right. The
Purchaser undertakes to assist us in the fulfilment of any form
requirements necessary for such purpose.
11. PLACE OF FULFILMENT, APPLICABLE LAW AND JURISDICTION:
11.1 The originating point of the goods shall, in each case, be the place of
fulfilment for the delivery. Munich shall be the place of fulfilment
for payment.
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11.2 Exclusively the laws of the Federal Republic of Germany shall apply
between the parties. The application of the 1980 United Nations
Convention on Contracts for the International Sale of Goods is
expressly excluded.
11.3 If the Purchaser is a merchant or does not have a general place of
jurisdiction in Germany, the place of jurisdiction is Munich. We
shall, however, have the right to also bring a claim against the
Purchaser at his general place of jurisdiction.
Munich, 15th May 2002
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APPENDIX C, PAGE 1 OF 2
Relevant Energy Price Index:
"BAFA Grenzubergangspreis" for natural gas
Source:
http://www.bmwi.de/BMWi/Navigation/Energie/Energiestatistiken/energiestatistiken
,did=53736.html
Evaluation periods:
- -- Arithmetic mean value out of 6 months
- -- April to September for price adjustment of 1st half of the following year
- -- October to March for price adjustment of 2nd half of year
- -- Basis evaluation period: April 2006 -- September 2006
Price Adjustment Table:
CB ... Index value of Basis evaluation period
CN ... Index value of New evaluation period
Price Adjustment
CN/CB (%) EURO / kg
- --------- ---------
< - 60 % [-]*
< - 40 % [-]*
< - 20 % [-]*
> + 20 % [-]*
> + 40 % [-]*
> + 60 % [-]*
> + 80% [-]*
etc. etc.
On the following example for the calculation of the price adjustment the
procedure is explained in more detail.
- ----------
* INFORMATION INTENTIONALLY OMITTED; CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR SUCH INFORMATION, AND SUCH INFORMATION HAS BEEN SEPARATELY
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
13
APPENDIX C, PAGE 2 OF 2
EXAMPLE FOR CALCULATION OF PRICE ADJUSTMENT
(FLOWCHART)