July 31, 2009 (FinancialWire) — Evergreen Solar, Inc. (NASDAQ: ESLR), a manufacturer of solar power products, said it has finalized its agreements with Jiawei Solarchina Co., Ltd., and the Wuhan government’s Hubei Science & Technology Investment Co., Ltd.

Under the agreements, Evergreen Solar will manufacture String Ribbon wafers using its Quad furnaces at a leased facility being built by Jiawei in Wuhan, China on Jiawei’s campus. Jiawei will convert the wafers into Evergreen Solar-branded panels on a contract manufacturing basis.

Evergreen Solar will reimburse Jiawei for its cell and panel conversion costs, plus a contract manufacturing fee. The actual price paid to Jiawei will be negotiated annually. Evergreen Solar will invest $17 million in cash and equipment in the Wuhan String Ribbon operation.

HSTIC will provide Evergreen Solar $33 million of 7.5% financing, which Evergreen Solar must repay no later than July 2014. Jiawei will make a similar investment for its cell and panel operations with the support of HSTIC.

Initial capacity will be around 100 megawatt. According to Evergreen, factory construction has begun and the parties expect that wafer, cell and panel production will begin in the spring of 2010.

The companies plan to expand production capacity of their respective manufacturing operations to around 500 MW by 2012. Evergreen said that the timing and extent of any potential expansion will be determined in 2010.

Evergreen Solar and Dynamic Green Energy, Ltd, Jiawei’s parent company, have agreed to exchange warrants representing 1% of their outstanding shares. These warrants will have a five-year term and may be exercised for 20% of the warrant shares for each incremental 95 MW of production capacity achieved.

Marlboro, Massachusetts-based Evergreen Solar develops, manufactures and markets String Ribbon solar power products using its proprietary silicon wafer technology. The company said its patented wafer manufacturing technology uses significantly less polysilicon than conventional processes.

Wuhan, China-based Jiawei Solarchina, through its Jiawei Solar subsidiary, is a manufacturer of solar products serving OEM and ODM customers around the world, including SunPower Corp.

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