LDK Solar Co., Ltd.("LDK Solar") (NYSE: LDK), a leading vertically integrated manufacturer of photovoltaic (PV) products, announced that it has reached an agreement with a Europe-based PV customer to terminate their long-term solar wafer supply agreement.
Under the terms of the agreement, originally signed in 2008, LDK Solar was to supply multicrystalline silicon wafers over a ten-year period. As part of the original agreement, the PV customer made an advanced payment representing a portion of the contract value to LDK Solar.
As part of the settlement, the parties mutually agreed to terminate the supply agreement, and that LDK Solar will receive approximately $37 million.
“We are pleased to reach a mutual agreement to terminate our 2008 wafer supply agreement with this customer,” stated Xingxue Tong, President and CEO of LDK Solar. “We will continue to work closely with our customers and partners in the currently challenging environment for the PV industry.”
LDK Solar is assessing the extent of financial impact on its full year 2012 earnings of the termination and related contract termination charges.