The Meyer Burger Group

Transcription

1 Annual Report 2010

2 Meyer Burger Annual Report 2010 The Meyer Burger Group Meyer Burger Technology Ltd is one of the world s leading providers of innovative systems and production lines for photovoltaics in the solar industry, and for the semiconductor and optics industries. The globally active technology group employs more than people across three continents. In photovoltaics, Meyer Burger offers its customers complete systems, comprehensive solutions and complementary technologies along the entire value chain including wafering, cells, modules and integrated solar systems. Mono-/Multi-c-Si Wafering Solar cells Solar modules Solar systems The systems, expertise and technologies of Meyer Burger Group are also deployed in the semiconductor and optical industries. The Group s core competences encompass a broad range of production processes, machines and systems, which are used for the production of ultra-thin, high-quality wafers, for the inspection and measurement of solar cells, for laminating, soldering, and testing of solar modules and for building-integrated solar systems. The Group covers the most important technology steps in the value chain of photovoltaics with its products and solutions portfolio. A worldwide service network with wear and tear parts, consumables, re-grooving services, process know-how, after-sales service, training and other services completes the comprehensive product portfolio.

3 Meyer Burger Annual Report 2010 Our Brands and Technologies Wafering Cutting technologies, band saws, ID/OD saws, wire saws Diamond wire technology, process consumables Automation and robotic systems Measurement and inspection systems, sorting systems for solar wafers Customised solutions for wafer handling, automation technology Solar cells SOLARIS Inspection systems, loading and unloading systems, sorting systems for solar cells Customised solutions for cell handling Fully automatic string soldering machines, soft-touch soldering process for solar cells Testing systems for solar cells and modules Coating for c-si solar cells Powered by Oerlikon Systems Solar modules Fully automatic production lines for solar modules, fully automatic laminating lines Fully automatic string soldering machines, soft-touch soldering process for solar cells Testing systems for solar cells and modules Solar systems Solar systems for façades, roofs, shading solutions Customer services Global after-sales services

4 Meyer Burger Annual Report 2010 Key Figures Consolidated income statement in TCHF Net sales Gross profit in % of net sales 49.5% 40.4% EBITDA in % of net sales 22.7% 15.0% EBIT in % of net sales 15.5% 9.8% Group earnings Consolidated balance sheet in TCHF Total assets Current assets Long-term assets Current liabilities Non-current liabilities Equity Equity ratio 60.3% 42.7% Net sales in CHF million EBITDA in CHF million Total balance sheet in CHF million Equity in CHF million

5 Table of Contents 2 Letter to Shareholders Report to Fiscal Year Management discussion and analysis of results Meyer Burger Group strategy 19 Our Global Presence 20 Core competences of Meyer Burger Group 28 Sustainability 34 Milestones Corporate Governance 36 Group structure and shareholders 39 Capital structure 46 Board of Directors 58 Executive Board 62 Compensation, shareholdings and loans 64 Shareholders participation rights 65 Change of control and defence measures 66 Auditors 67 Information policy Financial Report 70 Consolidated balance sheet 71 Consolidated income statement 72 Consolidated statement of other comprehensive income 73 Consolidated cash flow statement 74 Consolidated statement of changes in equity 76 Notes to the consolidated financial statements 138 Report of the auditors 140 Balance Sheet 141 Income statement 142 Notes to the financial statements 147 Proposal by the Board of Directors for the allocation of retained earnings 148 Report of the auditors Other information 150 Five-year summary 151 Information for investors and media 152 Addresses

6 2 Meyer Burger Annual Report 2010 Letter to Shareholders Dear Shareholders Peter M. Wagner Chairman 2010 was once more a record-breaking year for Meyer Burger Group. An organic sales growth of 62%, the successful integration of the 3S Group companies, surpassing the CHF 1 billion mark in incoming orders and order backlog for the first time in the company s history, and robust operating results are highlights in 2010 that we are proud of. Meyer Burger is a healthy, innovative technology Group, with a strong balance sheet, high cash flows, attractive profit margins and interesting prospects for continuing strong, sustainable growth. With the large order backlog at year-end, surpassing the CHF one billion mark in sales will just be a matter of time during Peter Pauli Chief Executive Officer Rising demand for energy solar power to be a key part of the solution Global demand for energy will continue to rise in the coming years. Estimates by respected, independent institutions such as the International Energy Agency (IEA) anticipate that global primary energy consumption will increase by 36% between 2008 and 2035, corresponding to an average annual growth rate of approximately 1.2%. Electricity consumption will increase by 2.2% per annum over the same period. The market share of technologies that use renewable energy will climb rapidly. Fossil fuels, such as crude oil, will become more expensive as supplies are finite, and climate change in particular means that alternative technologies will have to be used to a greater extent for the generation of electricity. With its technologies, processes and systems, Meyer Burger Group is active along the entire value chain of photovoltaics and thereby directly influences a further reduction in production costs and cost of electricity from renewables for the end users. Governments and politicians all around the world are faced with the challenge of adopting an environmental-friendly energy mix. The range of programmes for solar power and other renewable energy solutions that have been launched in major countries such as China, the USA and India as well as in many European countries, underlines the changes in attitude in this direction. That countries like Germany or Spain cut their feed-in tariffs for the time being, is in our opinion a direct result of the government deficits due to the economic and financial crisis of 2008/2009. We anticipate that this will result in a market consolidation among manufacturers and distributors of solar cells in the next few years. Nevertheless, the dynamic development of the solar industry as a whole will remain uninterrupted.

7 3 Additional technological advances are needed in the industry in order to further reduce the production costs of solar systems and to achieve grid parity as soon as possible. We believe that in certain countries grid parity could already be reached in With its strong strategic market position, Meyer Burger will continue to profit from the expected increasing demand. We will continuously expand our technological edge. The financial situation of our Group also allows us additional growth through targeted value-enhancing acquisitions. Strong, profitable growth in 2010 In 2010, Meyer Burger Group recorded CHF 1,329.8 million in incoming orders (2009: CHF million). The order backlog also surpassed the CHF 1 billion mark for the first time in the company s history, amounting to CHF 1,048.5 million as of 31 December 2010 (2009: CHF million). Net sales rose by 96% to CHF million (2009: CHF million). The organic growth rate achieved by the companies that were already within the scope of consolidated in 2009 reached 62%. This underlines the strong market position of our Group, and our excellent performance. Profitability also increased sharply. EBITDA rose by 196% to CHF million (2009: CHF 63.3 million), representing an EBITDA margin of 22.7% (2009: 15.0%). Group earnings amounted to CHF 97.9 million (2009: CHF 29.2 million). Total assets reached CHF 1,066.8 million as of 31 December 2010 (2009: CHF million) and equity amounted to CHF million (2009: CHF million), representing an equity ratio of 60.3%. Meyer Burger Group is active in an industry that will continue to be characterised by strong growth and innovation among the market leading companies. The Board of Directors therefore proposes to the Annual General Meeting on 21 April 2011 that retained earnings be carried forward to finance further growth of our Group. Net sales CHF M

8 4 Meyer Burger Annual Report 2010 Successful integration of the 3S companies Integration of the business activities of the 3S Group companies (merger in January 2010) proceeded according to plan and was completed by year-end of The integration took place in 16 key projects. During the first half of the year, we also adapted the brand architecture of our Group by launching a consistent brand image for all of the different technologies within the Group during March Our Group companies websites were also redesigned as part of this process and now represent a unified brand architecture. In autumn 2010, we acquired two long-term strategic sales and service partners in the USA (SGS Slicing Solutions Inc., Colombia, New Jersey, and SGS Machine Tool, LLC, Hillsboro, Oregon), as part of an asset purchase agreement. This strengthened Meyer Burger Group s sales and service organisation in the USA and allows us to serve this market from two new sites in addition to Diamond Materials Tech, Inc., which we acquired in Outlook Meyer Burger enjoys an excellent position along the value chain of the solar industry. With our strong presence in Asia and Europe, we benefit from the capacity expansions by solar cell manufacturers. For fiscal year 2011, we are planning to achieve further strong sales growth, with net sales of around CHF 1,200 million and an EBITDA margin of around 20%. These forecasts are based on the assumption that the economic conditions will remain largely stable and our customers will be able to realise their infrastructure projects as planned. We remain very positive on a long-term view. We firmly believe that the solar industry will meet a high proportion of the world's energy needs in future, as an efficient and environmentally sound source of energy. It is our firm intention to play a key role in further developing our market and the necessary technologies. Meyer Burger has the potential and financial strength to continue on the course of exponential growth of recent years, through both organic growth and targeted acquisitions. Personal comments and thanks As part of the merger with 3S in January 2010, the Board of Directors of Meyer Burger Group was expanded by three members who had previously served on the Board of 3S Group: Rudolf Samuel Güdel, Rolf Wägli and Prof. Dr. Konrad Wegener. Peter Pauli and Prof. Dr. Eicke Weber stepped down from the Board of Directors on the date of the successful merger. Peter Pauli continues to act as CEO of our Group. The newly expanded Executive Board includes Dr. Patrick Hofer-Noser, Michel Hirschi and Sylvère Leu. Prof. Dr. Eicke Weber also remains closely involved with the company, and has been in charge of the newly established Technology Advisory Board since February The Advisory Board supports the Board of Directors and the Executive Board with regards to development trends in solar energy, and new processes and technological solutions.

9 5 The success and repeated dynamic development of our Group in 2010 reflects the high motivation and outstanding achievements of our employees. On behalf of the entire Board of Directors and the Executive Board, we would like to express our special thanks and our highest appreciation. We also thank our customers and suppliers for working with us and for the trust that they place in our company. We would also like to thank you, our shareholders, for your confidence in and loyalty to our company. We look forward to sharing a successful future with you. Peter M. Wagner Chairman Peter Pauli Chief Executive Officer

10 PlanetSolar a project to protect the earth Circumnavigation of the globe in a solar-powered boat equipped with a silent, emission-free engine will enable PlanetSolar to display the true potential of photovoltaic energy technology. With this project, the PlanetSolar team aims to demonstrate that current solar technology is reliable and efficient, while giving research into renewable energies a decisive boost. PlanetSolar has already helped to push forward technological developments in various areas such as the manufacture of composite materials or the production and storage of solar energy or solar power. Each stage of the project and each day at sea will contribute to scientific progress in solar technology. First round-the-globe solar boat expedition Pasan SA, a member of Meyer Burger Group, actively supports PlanetSolar as an official scientific partner with many years of experience and know-how in measurement technology for solar modules. We are proud to contribute our expertise to the Swiss PlanetSolar expedition in the first solar-powered circumnavigation of the globe by sea.

11 PlanetSolar 2010

12 Klein Matterhorn Europe s highest solar power plant At an altitude of just under metres, the façade of the Klein Matterhorn Glacier Paradise restaurant, built in accordance with the latest environmental standards, produces the electricity required to run the gastronomy. Never before has a building-integrated photovoltaic system of this kind been constructed in Europe at such an altitude. With an installed capacity of 22 kilowatts, the electricity generated on the Klein Matterhorn is roughly equivalent to the annual consumption of twelve households. Sustainable low-emission construction in the Alps The high-precision lamination technology of 3S Modultec, a member of Meyer Burger Group, ensures a long service life for the modules even under the extreme weather conditions prevailing on the Klein Matterhorn. The new restaurant opened by Zermatt Bergbahnen is an excellent example of how environmental pollution can be reduced through modern, sustainable construction. Solar modules from our company provide the electricity for restaurant visitors and alpinists at this lofty height. Schweizer Solarpreis 2010 / Solar Agentur Schweiz

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14 10 Meyer Burger Annual Report 2010 Report to the Fiscal Year 2010 Order backlog CHF 1,048.5 M Management discussion and analysis of results 2010 The solar industry recovered significantly during 2010, following a very difficult market environment in 2009, when the global economic crisis and limited credit availability affected the financing of large projects. It became already evident during the first half of 2010 that large projects, which will substantially increase manufacturing capacities at solar cell producers in the years , received financial backing at normal conditions again. This trend was further confirmed during the second half of the year. Meyer Burger succeeded in concluding a number of major orders in this environment. In total, the Group recorded CHF 1,329.8 million in new orders, compared with CHF million in the previous year. For the first time in the company s history, incoming orders and order backlog surpassed the CHF 1 billion mark. As of 31 December 2010, the order backlog amounted to CHF 1,048.5 million, which once more provides an excellent basis for the business performance in the upcoming two years. Net sales by region in 2010 Sales Net sales rose by 96% to CHF million compared to CHF million in The increase in sales was based on 62% organic growth and 34% growth as a result of M&A activities. Sales grew most rapidly in Asia (+150%), which continues to be the most important customer region with 76% of net sales (percentage of sales in 2009: 60%). Europe provided 17% of net sales (change in sales of (4)%; percentage of sales in 2009: 34%), while customers in the USA accounted for 7% (growth of +144%; percentage of sales in 2009: 6%). Asia 76% Europe 17% America 7% Gross profit Gross profit more than doubled year-on-year to CHF million compared to CHF million in The gross margin for the period rose to 49.5% from 40.4% in The increase in margin was mainly due to very high production volumes at the manufacturing sites in Thun and Zülpich, which resulted in leverage on fixed production costs. This effect was further supported by general process optimisation, as well as a slightly changed product mix. Operating costs As of 31 December 2010, the Group employed 1,276 people on a full-time basis, an increase of 73% compared with 31 December The increase by a total of 538 employees includes 311 positions resulting from the merger with 3S Group and the acquisition of the SGS companies in the USA. The remaining 227 posts are newly created positions, mainly in production, research and development and in the after-sales services of the Group s service companies. In addition, 255 temporary employees (as of year-end 2010) were hired, predominantly in the second half of Personnel expenses for the year rose to CHF million compared with CHF 66.8 million in the previous year.

15 Report FY 2010 Corporate Governance Financial Report Other Information 11 Operating expenses increased to CHF 87.4 million during the reporting period, compared with CHF 40.0 million in This increase was primarily due to volume-related higher transportation costs, additional costs arising from the expansion of the Group, and M&A expenses in conjunction with the merger with 3S Industries Ltd in January EBITDA and EBIT EBITDA amounted to CHF million with a margin of 22.7% in 2010, compared with EBITDA of CHF 63.3 million and a margin of 15.0% in the previous year. Depreciation, amortisation and impairments during 2010 totalled CHF 59.7 million, including CHF 47.1 million for scheduled amortisation of intangible assets, which mainly relate to the acquisitions (Hennecke, AMB Automation and Diamond Wire), and to the merger with 3S Industries Ltd (3S Modultec, 3S Photovoltaics, Somont and Pasan). At EBIT level, Meyer Burger Group increased its profit by 209% to CHF million compared with CHF 41.3 million in The EBIT margin grew by 5.7 percentage points to 15.5%. EBITDA margin 22.7% Financial result and taxes The decline of the Euro and the US Dollar against the Swiss Franc (Euro (16.2)%, US Dollar (9.3)%) compared with year-end 2009 led to a substantially lower valuation of intercompany loans made by Meyer Burger Technology Ltd to foreign subsidiaries as of the balance sheet date 31 December The financial expenses of CHF 37.6 million include unrealised foreign exchange rate losses of CHF 31.6 million net, which predominantly related to the intercompany loans. Interest expenses during the reporting period came to CHF 3.5 million, compared with CHF 0.9 million in the previous year. In the first half of 2010, the federal and cantonal tax authorities granted tax relief of 50% on federal, cantonal, municipal and church taxes to the subsidiary MB Wafertec (Meyer Burger Ltd). The tax relief was granted retroactively to 1 January 2008 and for a period of 10 years. The tax relief resulted in a non-recurring positive effect on income taxes of CHF 9.6 million (tax credit for years 2008 and 2009) and in a reduction in tax expenses of CHF 14.1 million for In total, the income statement for 2010 includes recognised tax income of CHF 4.6 million, compared to a tax expense of CHF 10.1 million for the previous year. Group earnings Earnings for 2010 amounted to CHF 97.9 million, compared to CHF 29.2 million in the previous year. This corresponds to diluted earnings per share of CHF 2.18, compared to CHF 0.94 in As in previous years, the Board of Directors will propose to the Annual General Meeting on 21 April 2011 that the retained earnings shall be carried forward in order to finance continued growth.

16 12 Meyer Burger Annual Report 2010 Equity ratio 60.3% Balance sheet As a result of the merger with 3S Industries Ltd in January 2010 and the excellent result in 2010, the balance sheet increased strongly, reaching total assets of CHF 1,066.8 million as of 31 December The high amount of cash and cash equivalents and the sound cash flows allowed the Group to make an early repayment of CHF 29.2 million in June 2010 and a further repayment of USD 20 million in September 2010 on the syndicated loan that was agreed in September In addition, a further CHF 6.9 million in bank liabilities was repaid. Despite these repayments, cash and cash equivalents amounted to CHF million as of 31 December Compared to the substantial increase in sales, inventories and trade receivables only increased slightly. In conjunction with the merger with 3S Industries Ltd, the Group acquired intangible assets in an amount of CHF million. Mainly as a result of the excellent earnings (CHF 97.9 million) and the capital increase in conjunction with the merger with 3S Industries Ltd, equity increased to CHF million from CHF million in the previous year. The equity ratio rose to 60.3% from 42.7% as of year-end The balance sheet of Meyer Burger Group by the end of 2010 is entirely free of debt, very solid and healthy. Cash flow The Group generated an operating cash flow of CHF million, compared to CHF million in the previous year. The very strong cash flow is mainly due to high volumes of sales, positive developments in the margins and a substantial decrease in net working capital. The decrease in net working capital is mainly a result of the increase in customer payments and an optimised management of inventories. Cash flow from investing activities amounted to CHF million, compared with CHF (50.8) million in The merger with 3S Industries Ltd resulted in an increase in cash and cash equivalents of CHF 46.9 million. The Group paid CHF 24.9 million in cash and CHF 14.5 million by issuing shares of Meyer Burger Technology Ltd for the acquisition of the remaining 34% participation in Hennecke Systems GmbH. Capital expenditure in property, plant and equipment during 2010 reached CHF 13.3 million, net. Cash flow from financing activities was CHF (53.6) million, compared with CHF million in Due to the positive development of the cash situation, the Group repaid financial liabilities in a total amount of CHF 57.0 million during 2010.

17 Report FY 2010 Corporate Governance Financial Report Other Information 13 Currency risks Meyer Burger Group recorded approximately 70% of its net sales in Swiss Francs during fiscal year As major subsidiaries are located in Switzerland (MB Wafertec in Thun; 3S Modultec and 3S Photovoltaics in Lyss; Pasan in Neuchâtel), a large proportion of production is also based in the same country. Meyer Burger aims to achieve a high proportion of its sales in the same currencies that the individual subsidiaries deliver their production services, in order to limit currency risks as much as possible through a process of natural hedging. To hedge against residual currency risks, the company uses forward contracts. Meyer Burger does not hedge against foreign currency risks on the carrying amounts of foreign subsidiaries or on the conversion of the earnings of foreign companies. At constant exchange rates, net sales in fiscal year 2010 would have been approximately CHF 12.9 million higher than in the previous year (average exchange rates of the Euro and US Dollar declined by about 8.4% and 3.7%, respectively, compared with the previous year). Net sales by currency in 2010 CHF 70% EUR 22% USD 6% Other 2% Markets and customers In general, the solar industry was considerably more robust in 2010 than during the economically difficult year Global expansion in photovoltaic capacity in 2010 doubled to over 15 GW compared with 7.2 GW at the end of 2009 (source: EPIA Global Market Outlook for PV to 2014). However, the dynamic growth in the photovoltaic sector varied between the individual regional markets. In Asia, especially in the markets of China, India and South Korea, customers recovered most rapidly from the previous year s economic difficulties and were again successful in securing the financing for various large projects at normal conditions. The clear position of the Chinese government with its Golden Sun subsidies programme for solar energy has given this market additional momentum ever since the programme, which plans for 20 GW until the year 2020, was announced. In Europe, the largest manufacturers of crystalline silicon solar cells are still to be found in Germany. The announced reductions of up to 15% for feed-in tariffs in Germany s Renewable Energies Act (EEG) have not yet led to any major decline in demand by end users. In general, capacities among German cell manufacturers were also expanded during Meyer Burger further developed its already strong market position in Asia and Europe in Due to the sustained high levels in demand for Meyer Burger s slicing and sawing systems as well as for Hennecke s measurement technologies and inspection systems, the sales and customer-service organisation in China was further expanded. The fact that customer proximity and an excellent after-sales service are key to generating and maintaining customer satisfaction was confirmed by the Supplier of the Year award, which we received in 2010 from Trina Solar, an internationally recognised manufacturer of mono- and multi-crystalline photovoltaic modules in China.

18 14 Meyer Burger Annual Report 2010 Logo Corporate Brand Wafer sun Claim Brand The Meyer Burger brand Meyer Burger has a brand management strategy that conveys and embodies the unique nature and characteristics of the technology group within its strategic business areas. Following the merger with 3S Industries Ltd, the previously different brand images of the individual subsidiaries were unified. Within its own brand architecture, Meyer Burger has developed a new umbrella brand and a system of logos. The logo consists of three elements the brand image of a wafer sun, the corporate brand name and the brand s claim. The brand image is an arrangement of solar cells or wafers. The range of colours of the wafer sun that depict the sun together with the corporate and technology brand emphasise the corresponding corporate identity and the variety of industrial applications. Each subsidiary can thus have its own individual market appearance, while the connection of the shared wafer sun logo identifies each company as forming part of the Meyer Burger Group. The new brand policy was launched in March The brand image and the corresponding corporate brand names are trademarked throughout the world. The umbrella brand Meyer Burger and the Group s technology brands enjoy an excellent reputation and high degree of recognition within the industry. Additional public relations and advertising measures are used to further strengthen and underpin the brand recognition. Production In 2010, Meyer Burger s production facilities once again achieved an excellent industrial performance. At MB Wafertec in Thun, production output almost tripled in a year-on-year comparison. Even compared with the previous record year 2008, the number of machines manufactured in 2010 represented an increase of 57%. In December 2010, MB Wafertec surpassed the 1,000-machine threshold for the first time in the company s history. This achievement was reached thanks to ongoing analysis and optimisation of the entire manufacturing process. Ongoing analysis and optimisation is a day-to-day activity in our production facilities, allowing MB Wafertec to increase its production output and reduce assembly lead time as far as possible. With modularised machine components, optimised logistics and assembly processes, and increasing efficiencies throughout the production process, the time required to handle an order for a wire saw from the start of a customer order through to being ready for shipping is just four weeks. The lead time within the final assembly stage has been reduced to five days. At the beginning of 2011, MB Wafertec is producing up to 35 sawing systems per week. Our objective is to further expand capacities and raise production to up to 40 saws per week in the short-term. In the entire Meyer Burger Group, 1,421 machines and systems were produced in 2010, which represents an increase of 238% compared with the previous year.

19 Report FY 2010 Corporate Governance Financial Report Other Information 15 Innovation As a globally active technology group, Meyer Burger views innovation as a core element of its successful business strategy. With outstanding research and development, the Group continuously sets new benchmarks for production methods and processes that are used in photovoltaics. In the wafering process, sawing technologies and systems with diamond wire have undergone further development and improvements. The BrickMaster a diamond-wire saw specially developed by MB Wafertec to cut silicon blocks into process optimised brick shapes was successfully introduced in the market during 2010 and penetration in the high volume markets of Asia was very positive. The qualification of the diamond wire for the core process of wafering as well as the industrialisation of the diamond-wire-wafering process was pushed by strong support of research and development within MB Wafertec. The success confirms to Meyer Burger that our organisation supports the market with the right advanced technologies such as the diamond wire technology and at the same time helps leading solar cell manufacturers to reduce the total cost of ownership within the value chain of photovoltaics. With the introduction of diamond wire for the wafering process, another technology of our Group will develop into an important and recurring source of sales. A further focus of innovation is in combining individual technologies along the value added chain. With its comprehensive portfolio of technologies in wafering (MB Wafertec, Diamond Materials Tech (Consumables), MB Robotics, Hennecke, AMB Automation), in solar cells (Hennecke, AMB Automation, Solaris, Pasan), in solar modules (3S Modultec, Somont, Pasan) and in solar systems (3S Photovoltaics), Meyer Burger Group is represented in the key technology processes along the entire value chain of photovoltaics, and clearly distinguishes itself from its competitors. In 2010, various sales activities for integrated systems within the Group have led to joint customer contracts, particularly for MB Wafertec (saw technologies) in combination with Hennecke (measurement and inspection systems), and between the module line companies Somont (stringer systems), 3S Modultec (laminators) and Pasan (sun simulating systems).

20 16 Meyer Burger Annual Report 2010 Capital expenditure Meyer Burger Group invested CHF 40.6 million in research and development during This represents around 5% of net sales. Costs for research and development are not capitalised in the balance sheet, but recognised as expenses in the income statement. In total, 197 employees were engaged in research and development in the year under review. Capital expenditure in property, plant and equipment amounted to a gross amount of CHF 16.5 million in 2010 (net: CHF 13.3 million). For 2011/2012, additional capital expenditure of around CHF 50 million is expected, in connection with the first stage of construction for the new headquarters in Thun (approximately half of the amount in 2011, the other half in 2012). In November 2010, Meyer Burger was granted the final building permit for this new complex of buildings, and the ground-breaking ceremony was held in January The first stage of construction will result in a production and office facility for 600 to 700 employees, on a total land area of around 30,000 m 2. It is scheduled for completion and occupation by the end of Q1, The design is based on the latest innovations in building construction and energy management, and targets optimised energy efficiency. Meyer Burger has set itself the goal of keeping energy consumption as low as possible, while also striving for a high energy recovery. Once the entire building complex has been built and is in use for a longer period of time, it will be possible to measure the achieved energy parameters, which will be the case for the first time in The first stage of construction will take up around two thirds of the available land area. The planning phase for the second stage of construction has already started too. Planned new complex of buildings of MB Wafertec in Thun. Light grey: 2 nd stage of construction

21 Report FY 2010 Corporate Governance Financial Report Other Information 17 Risk management Meyer Burger uses various risk management instruments to assess and manage the strategic, financial and operational risks of the Group. The Board of Directors has primary responsibility for evaluating strategic risks. Financial and operational risks are mainly assessed by the Executive Board of Meyer Burger Technology Ltd. Regular risk reports are submitted to the Board of Directors. Risk management is integrated within the company s management processes, and involves in particular, the areas of Planning, Finance & Controlling, Internal Audit, Production & Logistics, Research & Development, Product Management, Sales, IT, Corporate Communications, Human Resources, and external tax and legal consulting. Occupational safety is of core importance to Meyer Burger. Through careful analysis of operating procedures and the provision of employee training, the Group minimises risks and achieves a high degree of process safety. Occupational safety as a topic is covered in detail on page 33 of this Annual Report. For more detailed information on financial risk management, please see Note 3 on page 93ff, in the financial statements. Targets and outlook for 2011 The long-term trend in favour of renewable sources of energy will be sustained. The solar industry will continue to enjoy strong growth, and will make a key contribution in the future to providing an efficient, non-polluting source of energy for the world. The industry still faces the challenge of making further cuts to the cost of solar electricity so that the aim of grid parity can be achieved as quickly as possible. The technologies developed by Meyer Burger Group will contribute to this process. With its extraordinarily strong presence in Asia and Europe, Meyer Burger is able to profit from the substantial expansion of photovoltaic capacities. With a healthy order backlog of about CHF 1,050 million, the company has made a very positive start into fiscal year Assuming that the economic conditions will remain relatively stable and that our customers will be able to carry out their expansion plans without major disruption, we anticipate net sales for 2011 of approximately CHF 1.2 billion and an EBITDA margin of around 20%.

22 18 Meyer Burger Annual Report 2010 Meyer Burger Group Strategy Our focus Photovoltaics Market leadership along the value chain in photovoltaics Meyer Burger is a world leading specialist in innovative systems and processes for cutting and handling crystalline and other high-grade materials. With its precision products and technologies, the Group has made a name for itself as an international premium brand in the photovoltaic industry. Our range of products and services covers the entire value chain in photovoltaics, including the production processes of wafering, solar cells, solar modules and solar systems. Our focus on the entire value chain enables us to develop technical innovations and align products and technologies in such a way that our customers manufacturing costs and their cost of ownership will be reduced continuously. The four pillars of our corporate strategy Solutions provider Our thinking as well as our research and development efforts, are focused on systems and processes. This allows us to continually set new standards for production processes in the photovoltaics industry. We offer our customers integrated systems and dedicated solution packages. We implement customer specific process control and supervising systems that span across different processes. By combining our process know-how and close customer process support with our service-oriented machinery and systems business and our logistics-driven consumables business, we provide substantial added value for our customers. Technological leadership We take an active part in shaping the industrial processes of the future and setting standards in the photovoltaics industry. At the same time, we evaluate and implement new technologies that can be used to achieve additional economies of scale, thus reducing the cost of ownership for our customers and the costs per kwh for solar power. Ahead of the market The market drives our product offering. We reach fastest time to market. We follow a consistent approach of optimising the level of modularisation and offering the best in terms of logistics for machinery and systems. Modularisation reduces the number of components used, which in turn optimises production time and costs and, combined with efficient logistics, leads to reduced production throughput times. We continually strengthen our service network, by expanding our range of value added services. Lean organisation, decentralised management Fast decision-making Lean organisation Meyer Burger is an innovative and modern employer, with a corporate culture characterised by openness. Our streamlined organisational structure and short decision-making paths serve to promote an understanding of personal and corporate responsibility of the management and the workforce as a whole. The companies in our Group assume responsibility as centres of excellence for their technologies. Our decentralised corporate structure allows us to achieve the highest levels of flexibility and profitability. With a strict vertical financial management, combined with horizontal interlinkage of competencies, we optimise our own resources.

23 Report FY 2010 Corporate Governance Financial Report Other Information 19 Our Global Presence Meyer Burger companies USA Colorado Colorado Springs; New Jersey Columbia; Oregon Hillsboro Europe Switzerland Baar, Lyss, Neuchâtel, Thun; Germany Langenfeld, Langweid, Umkirch, Wurzen, Zülpich; Norway Porsgrunn; Spain Barcelona Asia China Shanghai; India Pune; Japan Tokyo; Korea Seoul; Singapore Singapore; Taiwan Taoyuan County

24 20 Meyer Burger Annual Report 2010 Core Competences of Meyer Burger Group Wafering Thinnest wires cut thinnest solar wafers MB Wafertec specialises in cutting technologies and processes for hard and brittle materials. Band, cropping and wire saws are used to cut high-grade silicon, sapphire or other crystals into ultra-thin wafers, prisms and other shapes. Our machines meet the highest quality require ments with each single cut. Reliable cutting processes with 140 to 200 μm wire guarantee mass production in the photovoltaics industry. MB Wafertec s advanced wire saw technologies already qualify for wire strength ranging from 100 to 120 μm today. Diamond wire technology for bricking and wafering Diamond Wire develops and produces diamond wire that is used for cutting multi-crystalline silicon ingots into solar bricks and in a follow-up process cutting them into ultra-thin solar wafers. From a commercial and technological perspective, the technology represents a highly attractive alternative to the widely established slicing method using steel wire and slurry (a dispersion made of SiC and PEG). The use of diamond wire in cropping and wire saws shall enable customers to reach a significant increase in their production capacities. Fast and efficient brick/wafer handling and separation MB Robotics develops and implements customised solutions in the area of robotic handling systems. MB Robotics optimises cost- and quality sensitive processes of automated single processes up to fully automated process lines. AMB Automation develops advanced wafer handling and automation technologies. With AMB systems, it becomes possible to process and transport ultra-thinly cut wafers in a fast and efficient way, without any damage to the wafers. This can secure over 1.35 million solar wafers per year. Precise wafer quality inspection, feeding and sorting Hennecke specialises in optical and electrical precision measuring technology for solar wafers. The measuring equipment examines the quality of wafers in terms of thickness, edge defects, geometry, saw marks, sori, bow non-visible micro-cracks/inclusions and stain. Premium measurement devices enable an optimal quality control of solar wafers.

25 Report FY 2010 Corporate Governance Financial Report Other Information 21 Solar cells Quality assurance und measurement The inspection modules of Hennecke and the wafer handling solutions of AMB Automation are also used in the cell production process. Pasan offers cell-testing and -sorting equipment for the most precise performance measurement of solar cells. Even the slightest increase in accuracy of the performance measurement has a significant influence on the profitability of a cell manufacturer. Highest performance and quality in cell connection Somont offers string soldering machines for cell connections, with integrated testing equipment, lay-up systems and fully automated interconnection worldwide. The company guarantees the highest and scalable throughput of cells of 4,900 cells per hour through very flexible automation grades and maximum uptimes. Cell connection is a critical production process, as it determines the duration of the electrical output of the solar module. Reliable soft-touch soldering process Somont enables cells to be handled exceptionally gently with its specially developed string soldering machines and the established soft-touch soldering process. The machine types RAPID and CERTUS can process and solder precisely and reproducible all common types and sizes of solar cells. Homogenous uniformity of coating process The Solaris system, a strategic marketing and distribution cooperation with Oerlikon Systems, uses innovative coating technology in an efficient and precise way. In the anti reflective coating process Solaris offers a silane free alternative. Easy operation and maintenance The Solaris system can typically be put into operation at the customer s production facility within one week. The multi-source sputtering chambers can be changed by a single person (operator) within minutes, an advantage over other systems.

26 22 Meyer Burger Annual Report 2010 Solar modules Integrated production lines from a single source 3S Modultec is the technological world leader in laminating. During the laminating process, an interconnection takes place whereby the solar cells are encapsulated between a covering glass plate and a back sheet, made of glass or foil. This protects the solar module from weathering and is therefore critical to ensuring that the modules longevity is increased. Our laminating lines meet the most stringent demands placed on the laminating process. 3S Modultec integrates the various machines into entire production lines with different automation grades for the production of solar modules. 3S Modultec production lines are modular in their assembly design and can be expanded with a minimum of interruption in manufacturing and at lowest costs. The flexible 3S-Modultec-line-assortment combined with certification support and comprehensive process training are the basis for a project handling within the shortest period of time. The industry standard in performance measurement Pasan develops and produces testing systems for solar cells and modules. For certified quality assurance, testing of each worldwide produced module is part of the tests done by solar module manufacturers. The testing process is decisive with regard to the pricing of the individual module and therefore for the revenues of a module producer. Pasan testers have a unique light uniformity on the illuminated surface, outstanding light stability during the flash and an unmatched spectral correlation with sunlight. With such high standing quality, Pasan testers achieve top precision in the simulation of sunlight and are deployed by leading European test institutes such as the ESTI, the European Solar Test Installation, Italy, Fraunhofer ISE Freiburg, and TÜV Rheinland in Cologne, both in Germany. Through this excellence in know-how and certification, customers can save up to 6 months in time to market when introducing a new product winning time for the benefit of our customers.

27 Report FY 2010 Corporate Governance Financial Report Other Information 23 Solar systems State-of-the-art technology for building-integrated PV systems 3S Photovoltaics develops and produces building-integrated solar systems, and has become a specialist in solar modules for roofs, façades and shading solutions. The unframed solar modules enable large-scale solar energy systems which can be integrated into a building s shell to create a highly aesthetically and pleasing overall look. The offer can be adjusted to particular customer needs customised module sizes and special designs for example in case of major building projects or ancient objects that are under preservation. Intelligent solutions for every building The solar systems of 3S Photovoltaics replace traditional roof tiles, when used as in-roofsolutions. They are also used in façades, overhead glazing, porch roofs, balcony cladding and other special constructions, where an active energy production using the sun s strength is being sought. With more than 20 years of experience in highly prestigious PV projects, be it tourist buildings in high alpine locations, plus-energy-houses, public buildings such as nursery schools or campus facilities, 3S Photovoltaics enables projects for environmentally attractive buildings in the countryside as much as high-tech projects and tests for a future CO 2 -free mobility. Technology made in Switzerland for a long-term, high energy yield.

28 Solar Impulse / Jean Revillard

29 Solar Impulse a contribution to the future Solar Impulse, the solar airplane project of André Boschberg and Bertrand Piccard, is aiming to circumnavigate the globe. Without fuel, day and night. People are fascinated by great adventures and want to share the dreams of pioneers and explorers. Solar Impulse aims to use currently available technologies to unite this passion for adventure with positive and sustainable emotions related to renewable energy. Public attention must be drawn to the fact that changes need to be made if we are to ensure the energy requirements and environmental future of our planet. In July 2010, the first day and night flight took place with a flight time of over 26 hours. Solar Impulse thus achieved its first goal and demonstrated what can already be accomplished using alternative energy sources such as solar energy when combined with new technologies and applications. Solar Impulse represents the true potential of alternative energy sources 3S Modultec, a member of Meyer Burger Group, supports Solar Impulse as a specialist in the integration of solar cells into powerful solar modules. We are proud to be part of this fantastic project and adventure and to be able to use our expertise to support the circumnavigation of the globe in a solar plane.

30 A community building for livestock in Melchnau future-oriented, building-integrated solar technology The project combines state-of-the-art solar technology and attractive architecture with a private initiative and national networking. The newly constructed agricultural building in Melchnau is equipped with a photovoltaic system which is perfectly integrated into the roof of the building. The implementation of the facility was made possible through the collaboration of various local and national partners. For farmers, the use of solar power represents an important continuation of their tradition of a sustainable subsistence strategy that is in tune with nature, while opening up new sources of revenue through the sale of solar electricity. With an installed capacity of 264 kwp, the plant produces approximately 250,000 kwh of solar electricity each year, enough to supply around 65 households. Solar technology combining modern trends with tradition The pioneering project in Melchnau near Langenthal in the canton of Berne combines technological advances in solar power technology with the agricultural tradition of living in harmony with nature.

31

32 28 Meyer Burger Annual Report 2010 Sustainability As a globally active technology group, Meyer Burger has focused its long-term industrial and social commitment on the various internal and external stakeholders. Our aim is to further develop our company on a successful and sustainable basis. We are a reliable partner to our customers, suppliers, employees and trainees, as well as to our shareholders and the public. Our values We are committed to acting ethically and responsibly. Sustainability We focus on achieving sustainable profitability and growth. We work in harmony with the environment and adhere to core social values. Long-term loyal partnership Our actions, both within the Group and in terms of our relationships with our suppliers, customers and business partners, are marked by loyalty and respect. We strive for a trusting and target-oriented cooperation. Creativity and innovation We are innovative and set new benchmarks in our markets. We combine innovation with competitiveness, customer benefits, consistent quality and long-term reliability. Code of Conduct In its Code of Conduct, Meyer Burger has constituted rules that govern interactions with people inside and outside of the Group. All of our employees throughout the world are bound by this Code of Conduct. Meyer Burger is committed to equal opportunities, an open and friendly working environment, transparency and respect. We regard team spirit and individual responsibility as key elements for good, sustainable corporate development. The company fights all forms of discrimination and adheres strictly to the national and international legislations that are relevant to the Group. The Code of Conduct contains principles and guidelines on cooperation within Meyer Burger Group, on equality of opportunity for our employees, against mobbing or harrassment in the workplace, on behaviour in respect of contracted partners and customers, on the confidentiality of business secrets and information, and on obligations to report any kind of abuse. In the event of uncertainty or doubt, line managers, the Code of Conduct Officer or a member of the Executive Board may be approached for advice or support at any time. For the Board of Directors and the Executive Board, this Code of Conduct and strict compliance with the guidelines are of paramount importance. For this reason, in 2007 the Board of Directors appointed the company s Chief Financial Officer, Michel Hirschi, as the direct Code of Conduct Officer.

33 Report FY 2010 Corporate Governance Financial Report Other Information 29 Environment Through the involvement in the value chain of photovoltaics, our Group is closely tied to the ecological benefits of using solar cells as a source of electricity and energy. In our production processes, we take care not to use hazardous substances or pollutants, wherever possible. During fiscal year 2010, the electricity consumption of the entire Group amounted to 9.1 million kwh. On 10 January 2011, we were able to celebrate the ground-breaking ceremony for the new corporate headquarters of MB Wafertec in Thun. This site will comprise a newly constructed production and office facility for 600 to 700 employees. Construction of the first stage is scheduled for completion by the end of Q The design is based on the latest innovations in building construction and energy management, and targets most optimised energy efficiency. In comparison with the currently leased manufacturing and office facilities, which are spread over 15 different buildings throughout the region, we anticipate that the new site will lead to a significant reduction in our average energy consumption from 2013 onwards. The basic objective is to keep energy consumption as low as possible, while also striving to recover as much energy as we can. We will set precise targets for the site at the end of 2012, once the buildings have been completed and are in use. Social role as an employer Meyer Burger provides a technological and creative working environment. In the past four years, our company has grown from a pure specialist of highly innovative sawing machines with annual sales of CHF 83 million and 284 employees in 2006, to a global technology group with sales of CHF 826 million and 1,276 employees (FTE) in This tremendous growth presents our Group and our staff with new challenges, for example in rapid adjustment to changing corporate structures, increased production output, improvements to our products through research and development, and in training and continuing professional development. However, the dynamic growth also opens up new opportunities and horizons. We foster a corporate culture in which everyone can make a personal contribution. Our company thrives from the pioneering spirit, creativity and outstanding commitment of our staff. Our streamlined organisational structure and short decision-making paths serve to promote a common understanding of personal and entrepreneurial responsibility on the part of management and the workforce as a whole. We want to be an employer that attracts outstanding talents from the market. We offer our employees fair and competitive salaries, good social benefits, and promote targeted training and development. Our corporate culture is characterised by technology, openness, transparency, team spirit and responsibility.

34 30 Meyer Burger Annual Report 2010 Development of personnel since 2007 Number of employees (FTEs) More than 1,500 employees More than 1,500 people were working on innovative products and solutions at our sites across the world, at the end of The number of employees on permanent contracts rose by around 73% year-on-year, to a total of 1,311 people (1,276 FTEs). Of these, 311 FTEs were added by the merger with 3S Group at the beginning of January 2010 and the takeover of the SGS companies in the USA in November The remaining 227 positions were newly created jobs, mainly in production, research and development, and in the after-sales services in our service companies. In order to avoid capacity constraints in production and logistics, we also hired an increasing number of temporary staff during the second half of In addition to its permanent workforce, as of 31 December 2010, the Group also employed 225 people on a temporary basis (year-end 2009: 10 temporary employees). Workforce Employees (FTEs) Total at year-end Production, Logistics Research, Development Sales, Services Finance, Administration Training and Personnel Development The sustainable and systematic development of our employees occupational skills is a core focus of our Human Resources policy. We firmly belief that this approach also allows us to strengthen the competitive position of our company. In order to be able to enhance our employees full potential, we put great value to continuing professional development. We support a broad range of in-house and external training opportunities, ranging from apprenticeship training courses to individually tailored management seminars and vocational training programmes. On-the-job training is another important instrument of our personnel development programme. Meyer Burger has been active in basic vocational training under the various systems that exist in different countries and has been training young people in commercial careers and, in particular, in technical vocations for many years. We offer internships to students from the Swiss Federal Institute of Technology (ETH) and universities, to give them their first experiences of working in the industry. In 2010, the Group companies based in Switzerland offered 34 vocational training places; two further apprenticeships were offered by subsidiaries in Germany. In Switzerland, trainees make up 5% of the total workforce. These apprenticeships were spread over four occupational groups fitter, automation mechanic, design engineering and commercial. In 2010, we received approval to add apprenticeships in IT and logistics to these four groups. This means that in the current reporting period 2011, we are able to offer apprenticeships in six different training professions and trades in Switzerland.

35 Report FY 2010 Corporate Governance Financial Report Other Information 31 Employees

36 32 Meyer Burger Annual Report 2010 Employee structure by region in 2010 Talent Management A key strategy in our HR policy is to fill vacancies in key leadership and management positions with internal candidates, wherever possible. We support this training of the next generation of managers with our own specific management development process. In 2010, 82% of all senior management vacancies (Executive Managements in the subsidiaries) were filled by internal candidates. Switzerland 51% Europe (excl. Switzerland) 22% Employees in 2010 Male 85% Female 15% Asia 10% USA 17% Management training During 2010, we conducted several leadership workshops and management development seminars for the benefit of our managers. About 100 managers throughout the Group participated in two separate leadership workshops in April and September. The aim of these seminars was to strengthen a shared management culture within Meyer Burger and to improve the skills of our managers at all levels. The interconnection of our various group companies as a key factor for the success of Meyer Burger was a further priority in the second workshop. Long-term partnerships with customers and suppliers The commercial success of Meyer Burger Group is based on the confidence of our customers and on supplier relationships that are nurtured on a foundation of partnership. Our technology companies have earned the confidence of their customers through the reliability of their products, high standards of quality, excellent services and personal relationships based on fairness. Our focus on the entire value chain in photovoltaics means that we can continuously develop technical innovations and align products and technologies at the different process stages in wafer, cell and module production in such a way that our customers manu facturing costs and their cost of ownership are continually reduced. To ensure the expansion of our production capacities, we are reliant on timely deliveries of pre-fabricated components and on the integration of our key suppliers into our internal logistics processes. Therefore, we also strive to maintain open communication channels with our suppliers, and to develop long-term business relationships based on mutual partnership.

37 Report FY 2010 Corporate Governance Financial Report Other Information 33 Occupational safety, quality management Occupational safety, accident prevention in the workplace and looking after our employees health is very important to us. Meyer Burger has issued clear safety rules for visitors and employees in its production and logistics operations. Our staff receive regular training in accident prevention, and are provided with written documentation and the opportunity to attend information events. In production and logistics environments, we provide employees with specific training for dealing with cranes, fork-lifts and special tools that are used in the process of packing machinery for shipping, such as nail guns for example. In addition to providing every employee with thorough instruction, we also carry out regular safety reviews so that any potential hazards can be detected at an early stage and eliminated without delay. Thanks to this comprehensive approach to health and safety, Meyer Burger Group once again recorded an exceptionally low figure of 0.72% (2009: 0.98%) for absences caused by occupational accidents in 2010 (measured as a proportion of total output). The entire Meyer Burger Group operates on the basis of high quality standards, as reflected in its products, services and solutions. By means of clearly defined quality management, our Group companies ensure that we can fulfil our customers requirements in terms of product safety and deadlines. Workflows and structures are updated regularly and documented accordingly, with employees having direct access to those documents at all times. The largest subsidiary in terms of production, MB Wafertec, has integrated occupational health and safety into its management system, and has been awarded certification of compliance with OHSAS 18001:2007 (Occupational Health and Safety Management System) and ISO 14001:2007 (Environmental Management). In addition, MB Wafertec, 3S Modultec and 3S Photovoltaics are all certified as compliant with ISO 9001: 2008 (Quality Management).

38 34 Meyer Burger Annual Report 2010 Milestones 2010 Acquisition of SGS Slicing Solutions, Inc., Colombia, New Jersey, USA, and of SGS Machine Tool, LLC, Hillsboro, Oregon, USA, two long-standing strategic sales and service partners, by means of an asset purchase agreement Acquisiton of the remaining 34% share capital of Hennecke (Hennecke Systems GmbH) Merger with 3S Industries Ltd, the leading provider of manufacturing equipment and entire production lines for the manufacturing of solar modules, with its centres of excellence 3S Modultec (laminating), Somont (electrical cell connection, soldering process), Pasan (testing and measuring of solar cells and modules) and 3S Photovoltaics (solar systems for façades, roofs, shading) Market launch of the BrickMaster for cutting multi-crystalline silicon ingots into square bricks Acquisition of business activities of Diamond Wire (Diamond Materials Tech, Inc., Colorado Springs, USA producer of diamond wire) Acquisition of the remaining 49% share capital of AMB Automation (AMB Apparate + Maschinenbau GmbH) Strategic cooperation with OC Oerlikon Balzers Ltd for the distribution and further development of the Solaris systems used for the coating of crystalline solar silicon cells 2008 Acquisition of majority participations in Hennecke (Hennecke Systems GmbH precision measurement and sorting systems for solar wafers) and AMB Automation (AMB Apparate + Maschinenbau GmbH wafer handling and automation technologies) 2007 Market launch of a fully automated and integrated brick line for mono-crystalline and multi-crystalline silicon bricks 2006 Holding name changed to Meyer Burger Technology Ltd, incorporated in Baar, Switzerland Initial Public Offering on 23 November 2006 on SIX Swiss Exchange 2005 Market launch of wire saw DS 264 Joint venture with SiC Processing (Wuxi) Ltd., Wuxi, China 2004 Market launch of band saw with rotating clamping table BS 805 for solar industry and of wire saw DS Market launch of diamond wire saws in cooperation with Diamond Wire (Diamond Wire Technology, Inc.), USA Foundation of subsidiaries in China and Japan, positioning in the Asian markets Entering the Russian market through agreement with sales agent High Tech Solutions, Moscow Entering the Asian and American markets through cooperation with SiC to ensure slurry-recycling supply of Meyer Burger customers

39 Report FY 2010 Corporate Governance Financial Report Other Information Launch of wire saw DS 261, specially targeted at 12 semiconductor industry Further development of band saw BS 800 into BS Market launch of the first wire saw DS 262, which was specifically targeted at the solar industry 1999 Incorporation of Meyer & Burger Holding Ltd, incorporated in Zug, Switzerland Market launch of the first band saw BS 800 for solar industry and of wire saw DS 261 for semiconductor industry 1998 Development of band saw for wafer mass production 1992 Market launch of ID saw TS Market launch of wire saw DS Market launch of OD saw TS Development of a saw based on wire saw technology 1977 Market launch of ID saw TS 23 Starting 1970 Development of ID saw and start of cutting of silicon wafers for the semiconductor industry 1960 Market launch of OD saw TS Foundation of Meyer & Burger Ltd

40 36 Meyer Burger Annual Report 2010 Corporate Governance Meyer Burger is fully committed to good Corporate Governance. The Company relies on the recommendations of the Swiss Code of Best Practice for Corporate Governance by Economiesuisse and adheres to the standards of the directive on information relating to Corporate Governance by SIX Swiss Exchange, if applicable and significant to Meyer Burger. 1. Group structure and shareholders 1.1 Group structure Meyer Burger Technology Ltd (subsequently referred to as the Company ) is a holding company organised in accordance with Swiss law and holds all companies belonging to the Meyer Burger Group either directly or indirectly. Meyer Burger Group is a leading and globally active technology group specialising in innovative systems and processes for cutting and handling crystalline and other high-grade mate r ials. With its products and services, the Group covers different parts of the value chain in the solar (photovoltaic), semiconductor and optical industries. Until 14 January 2010, the Group was operationally managed by the Executive Board (Chief Executive Officer, Chief Financial Officer). The Executive Board was extended as part of the merger between Meyer Burger Technology Ltd and 3S Industries Ltd on 14 January 2010 (date of the Extraordinary Meeting of Shareholders). The operational Group structure is organised according to different areas of responsibilities of each member of the Executive Board. These responsibilities apply across the entire Group and on a global basis. Chief Executive Officer Overall Operational Management, Strategy, Marketing & Sales, Corporate Communication, Human Resources Chief Financial Officer Finance, Group Controlling, Treasury, Mergers & Acquisitions, Investor Relations, Tax & Legal, Group IT Chief Technology Officer Management Research & Development, Deputy CEO Chief Innovation Officer Planning, Technology Development along process chain, Control and Organisation of business processes

41 Report FY 2010 Corporate Governance Financial Report Other Information Listed company The shares of Meyer Burger Technology Ltd, headquartered in Baar, Switzerland, are listed on SIX Swiss Exchange (Valor-No , ISIN-No. CH ). The ticker symbol is MBTN. Meyer Burger Technology Ltd held 45,521 treasury shares as of 31 December None of the other consolidated group companies held any shares in Meyer Burger Technology Ltd. The market capitalisation of the Company reached CHF 1,328.8 million as of 31 December Market capitalisation CHF 1,328.8 M 1.3 Non-listed companies The scope of consolidation includes non-listed companies, which are listed on page 80 in the financial section of this Annual Report. 1.4 Significant shareholders The Company is aware of the following shareholders, who according to Article 20 SESTA (Stock Exchange Act) held more than 3% of the voting rights based on the outstanding share capital as of 31 December 2010: Shareholder Voting rights Credit Suisse Asset Management Funds AG, CH-Zurich > 3% Gerhard Knoll, DE-Umkirch 1 > 3% Peter Pauli, CH-Möhlin % Swisscanto Asset Management AG, CH-Zurich > 3% The Capital Group Companies, USA-Los Angeles/CA > 3% Vontobel Fonds Services AG, CH-Zurich > 5% 1 incl. employee shares in vesting period and employee options held Disclosure of shareholdings by various shareholders in accordance with Article 20 SESTA during fiscal year 2010: Eiger Investments, LLC (previously Diamond Wire Technology, LLC), USA-Colorado Springs Going below the 3% threshold limit as of 15 January 2010, as a result of the capital increase in conjunction with the merger between Meyer Burger Technology Ltd and 3S Industries Ltd (disclosed participation %). W+S Maschinenbau GmbH, DE-Freiburg Exceeding the 3% threshold limit as of 15 January 2010, as a result of the merger between Meyer Burger Technology Ltd and 3S Industries Ltd (disclosed participation 3.266%). Going below the 3% threshold limit as of 6 May 2010, as a result of sale transactions (disclosed participation < 3%). Peter Pauli, CH-Möhlin Going below the 5% threshold limit as of 15 January 2010, as a result of the capital increase in conjunction with the merger between Meyer Burger Technology Ltd and 3S Industries Ltd (disclosed participation including employee options held 4.1%).

42 38 Meyer Burger Annual Report 2010 Swisscanto Asset Management AG, CH-Zurich Exceeding the 3% threshold limit as of 15 January 2010, as a result of the merger between Meyer Burger Technology Ltd and 3S Industries Ltd (disclosed participation 3.11%). Gerhard Knoll, DE-Umkirch Exceeding the 3% threshold limit as of 15 January 2010 through holding by Ernst Knoll Feinmechanik GmbH, DE-Umkirch (controlled by Gerhard Knoll), as a result of the merger between Meyer Burger Technology Ltd and 3S Industries Ltd (disclosed participation including employee options held 3.83%). Meyer Burger Technology Ltd, CH-Baar Sale position of over 3% due to outstanding employee options (disclosed sale position 3.95%). Employee options were granted in different years since The disclosure notice was filed on 21 July Credit Suisse Asset Management AG, CH-Zurich Exceeding the 3% threshold limit as of 17 September 2010, as a result of purchase transactions (disclosed participation 3.26%). Vontobel Fonds Services AG, CH-Zurich Going below the 5% threshold limit as of 14 October 2010, as a result of sale transactions (disclosed participation %). Exceeding the 5% threshold limit as of 20 October 2010, as a result of purchase transactions (disclosed participation 5.018%). The Capital Group Companies, Inc., USA-Los Angeles/CA Exceeding the 3% threshold limit as of 27 October 2010, as a result of purchase transactions (disclosed participation %). Details to the individual disclosure notices mentioned above are available on the website of SIX Swiss Exchange under the direct link Cross-shareholdings Meyer Burger Technology Ltd does not have any cross-shareholdings with other companies as of 31 December 2010.

43 Report FY 2010 Corporate Governance Financial Report Other Information Capital structure 2.1 Capital structure as of 31 December 2010 Ordinary share capital CHF (registered in the commercial register: CHF ) fully paid-in registered shares with a nominal value of CHF 0.05 each (registered in the commercial register: registered shares) Conditional share capital CHF (according to Articles of Association: CHF ) registered shares with a nominal value of CHF 0.05 each for exercising of option rights granted to employees and members of the Board of Directors of the Company or of group companies (according to Articles of Association: CHF registered shares) CHF registered shares with a nominal value of CHF 0.05 each for exercising of conversion and/or option rights in conjunction with convertible bonds, bonds with option rights or similar financial market instruments of the Company or of group companies Authorised share capital CHF registered shares with a nominal value of CHF 0.05 each issuance possible until 29 April Conditional share capital In accordance with Article 3b of the Company s Articles of Association, dated 29 April 2010, the share capital may be increased by a maximum amount of CHF 202, by means of the issuance of no more than 4,050,250 fully paid-in registered shares with a nominal value of CHF 0.05 each, by virtue of the exercise of option rights granted to employees and members of the Board of Directors of the Company or of group companies in accordance with a plan to be worked out by the Board of Directors. The preferential rights of the shareholders shall be excluded. In accordance with Article 3c of the Company s Articles of Association, dated 29 April 2010, the share capital may be increased by a maximum amount of CHF 200, by means of the issuance of no more than 4,000,000 fully paid-in registered shares with a nominal value of CHF 0.05 each, by virtue of the exercise of conversion and/or option rights in conjunction with convertible bonds, bonds with option rights or similar financial market instruments of the Company or of group companies. The preferential rights of the shareholders shall be excluded in connection with the issuance of convertible bonds, bonds with option rights or other financial market instruments, which carry conversion and/or option rights. The then current owners of conversion and/or option rights shall be entitled to subscribe for the new shares. The acquisition of shares through the exercise of conversion and/or option rights and each subsequent transfer of the shares shall be subject to the restrictions set forth in Article 4 of the Articles of Association (in reference to limitations for registration in the share register).

44 40 Meyer Burger Annual Report 2010 The Board of Directors may limit or withdraw the right of the shareholders to subscribe in priority to convertible bonds, bonds with option rights or similar financial market instruments when they are issued, if: 1) the financial market instruments with conversion or option rights are issued in conjunction with the financing or refinancing of the acquisition of an enterprise or parts of an enterprise or with participations or new investments of the Company; or 2) an issue by firm underwriting by a bank or a consortium of banks with subsequent offering to the public without preferential subscription rights seems to be the most appropriate form of issue at the time, particularly in terms of the conditions or the time plan of the issue. If advance subscription rights are denied by decision of the Board of Directors, the following shall apply: 1) conversion rights may be exercisable only for up to 10 years, option rights only for up to 7 years from the date of the respective issuance; and 2) the respective financial market instruments must be issued at the relevant market conditions. 2.3 Authorised share capital In accordance with Article 3a of the Articles of Association, dated 29 April 2010, the Board of Directors is entitled to increase the share capital of the Company by not more than CHF 225, until 29 April 2012 by virtue of the issuance of a maximum of 4,500,000 registered shares with a nominal value of CHF 0.05 each. The Board of Directors is entitled to limit or exclude the advance subscription rights of the shareholders and allocate them to third parties, if the new shares are to be used: 1) for the acquisition of enterprises, parts of enterprises, participations or new investment plans; 2) for the financing or refinancing of the acquisition of enterprises, parts of enterprises, participations or new investment plans; or 3) for the placement of shares in the capital market. Shares, for which advance subscription rights have been granted but not exercised, should be used in the interests of the Company. The increase can take place by means of a firm underwriting and/or in partial amounts. The Board of Directors is entitled to set the issue price of the shares, the type of contribution, as well as the date of entitlement to dividends. Shares issued under these terms are subject to limitations for registration in the share register in accordance with Article 4 of the Articles of Association of the Company.

45 Report FY 2010 Corporate Governance Financial Report Other Information Changes in capital over the past three reporting years in TCHF Share capital Capital reserves Reserve for treasury shares 574 Profit Total equity Changes in capital during 2010 In conjunction with the successful conclusion of the merger with 3S Industries Ltd, the Extraordinary Meeting of Shareholders held on 14 January 2010 approved a share split in a ratio of 1:10 and an ordinary increase in the share capital. The Board of Directors decided to implement the share capital increase of CHF 625, to CHF 2,229, (capital as in the commercial register) directly after the shareholders meeting. In the time span between 1 January 14 January 2010, 1,550 employee options (after the share split on 14 January 2010: 15,500 options) were exercised and the ordinary share capital therefore increased by CHF 775. The capital increase was determined by the Board of Directors on 4 February 2010 and r egistered with the commercial register. As of 4 February 2010, the ordinary share capital of the Company amounted to CHF 2,230, (44,618,774 registered shares with a nominal value of CHF 0.05 each). The conditional capital amounted to CHF 202, (4,050,250 registered shares with a nominal value of CHF 0.05 each) for exercising of option rights granted to employees and members of the Board of Directors, and to CHF 150, (3,000,000 registered shares with a nominal value of CHF 0.05 each) for exercising of conversion and/or option rights in conjunction with convertible bonds, bonds with option rights or similar financial market instruments. The authorised capital amounted to CHF 188, (3,770,000 registered shares with a nominal value of CHF 0.05 each). Further details to the capital structure after the merger are available on page 30 of the Annual Report The Report is available on the Company website under: investor-relations/financial-reports/archive/ In conjunction with the successful conclusion of the purchase contract for the remaining 34% participation in Hennecke Systems GmbH, the Company issued 540,346 registered shares on 22 April 2010 out of the existing authorised share capital at that time. The ordinary share capital increased by CHF 27, to CHF 2,257, (45,159,120 registered shares with a nominal value of CHF 0.05 each). At the same time, the authorised capital decreased by the corresponding amount of CHF 27, to CHF 161, The General Meeting of Shareholders on 29 April 2010 resolved, in line with the proposals of the Board of Directors, the following changes in capital: 1) Increase of the conditional share capital for convertible bonds and/or bonds with options or other financial market instruments from previously existing CHF 150, (3,000,000 registered shares) to CHF 200, (4,000,000 registered shares).

46 42 Meyer Burger Annual Report ) Continuation and a respective increase of the authorised share capital to CHF 225, (4,500,000 registered shares), issuance possible until 29 April As a result of the exercise of options, the ordinary share capital increased until the end of fiscal year 2010 by CHF 21, (425,603 registered shares) to CHF 2,279, (45,584,723 registered shares). The conditional share capital for exercising of option rights granted to employees and members of the Board of Directors decreased by the corresponding amount to CHF 181, (3,624,647 registered shares). The registration of the corresponding change has not been registered in the commercial register yet Changes in capital during 2009 In conjunction with the successful conclusion of the purchase contract for the business activities of Diamond Wire Technology, LLC, the Company issued a total of 163,000 registered shares out of the existing authorised share capital in September As a result, the ordinary share capital of the Company increased by CHF 81, to CHF 1,594, and the authorised share capital decreased to CHF 188, As a result of the exercise of 19,875 employee options between 1 January and 16 December 2009, the conditional share capital for exercising of option rights granted to employees and members of the Board of Directors decreased as of 16 December 2009 from CHF 213, to CHF 203, The ordinary share capital increased by CHF 9, from CHF 1,594, to CHF 1,604, The registration of the change in the Articles of Association in the commercial register was done on 17 December Between 17 December 2009 and 31 December 2009, an additional 800 employee options were executed. The conditional share capital for exercising of option rights granted to employees and members of the Board of Directors decreased as of 31 December 2009 from CHF 203, to CHF 203, The ordinary share capital increased by CHF from 1,604, to CHF 1,604, The registration of the corresponding change in the commercial register was done, together with the change in capital in conjunction with the merger with 3S Industries Ltd, on 15 January Changes in capital during 2008 In conjunction with the successful conclusion of the purchase contracts for the acquisition of majority stakes in AMB Apparate + Maschinenbau GmbH and in Hennecke Systems GmbH, the Company issued a total of 63,440 registered shares out of the existing authorised share capital in January and February 2008, respectively. As a result, the ordinary share capital of the Company increased by CHF 31, to CHF 1,511, and the authorised share capital decreased to CHF 263, The General Meeting of Shareholders on 8 May 2008 resolved, in line with the proposals of the Board of Directors, the following changes in capital: 1) Increase of the conditional share capital for exercising of option rights granted to employees and members of the Board of Directors of the Company or of group companies from previously existing CHF 145, to CHF 215,

47 Report FY 2010 Corporate Governance Financial Report Other Information 43 2) Creation of new conditional share capital for convertible bonds and/or bonds with options or other financial market instruments of CHF 150, ) Continuation and a respective increase of the authorised share capital of previously existing CHF 263,280.00, issuance possible until 28 September 2008, to CHF 270, and issuance possible until 8 May As a result of the exercise of 2,750 employee options, the conditional share capital for exercising of option rights granted to employees and members of the Board of Directors has decreased to CHF 213, since the General Meeting of Shareholders was held on 8 May The ordinary share capital has increased by the respective amount of CHF 1, to CHF 1,513, The corresponding changes in the Articles of Association were registered in the commercial register as of February Shares The share capital of Meyer Burger Technology Ltd, as of 31 December 2010, was divided into 45,584,723 registered shares (number of registered shares reflected in the commercial register as of was 45,159,120) with a nominal value of CHF 0.05 each. All shares are fully paid-in. Each share is entitled to one vote. All shares are entitled to dividends. The Company recognises only one entitled party for each share. A share register is kept on the shares issued, in which the owners, usufructuaries and nominees of the registered shares are entered along with the name, domicile, address and nationality. The entry in the share register depends on identification by means of transfer of the ownership interest or the creation of a usufruct in the correct form and in accordance with the Articles of Association. The Company will only consider as shareholders those, who are registered in the share register. 1 Share: 1 Vote 2.6 Participation or bonus certificates The Company has neither participation nor bonus certificates outstanding. 2.7 Limitations on transferability and nominee registrations As a matter of principle, the Articles of Association of the Company do not include any restrictions on transferability. Acquirers of registered shares are entered into the share register upon request as shareholders with voting rights providing that they expressly declare that they have acquired these registered shares on their own behalf and for their own account. The Board of Directors may enter nominees with up to a maximum of 3% of the registered share capital with voting rights in the share register. In accordance with this regulation, nominees are persons who do not expressly declare in the share register entry that they hold the shares for their own account and with whom the Board of Directors has entered into an agreement to this effect. Beyond this limit, the Board of Directors can enter registered shares of nominees with voting rights in the share register, if the nominee in question states the name, address and shareholdings of those persons for whose account it holds 0.5% or more of the registered share capital as recorded in the commercial register.

48 44 Meyer Burger Annual Report 2010 Legal entities or partnerships or other associations or joint ownership arrangements which are linked through capital ownership or voting rights, through common management or in like manner, as well as individuals, legal entities or partnerships (especially syndicates) which act in concert with intent to evade the entry restrictions are considered as one shareholder or nominee. The entry restrictions also apply to registered shares that were purchased or acquired through the exercising of advance subscription rights, options or conversion rights. 2.8 Convertible bonds, options, share participation programme As of 31 December 2010, Meyer Burger Technology Ltd did not have any convertible bonds outstanding. Option plan (until the end of fiscal year 2009) The Board of Directors of the Company has adopted an option plan in fiscal year 2006 for the members of the Board of Directors and the members of the Executive Board as well as for other key employees within the group. Based on this plan, the Board of Directors granted options. The options were granted free of charge and are non-transferable. Each option entitled to subscribe to a registered share (nominal value of CHF 0.05) in accordance with the conditions determined by the Board of Directors. After a defined vesting period, the options could be exercised during the exercise period but only, if a valid employment contract or Board membership existed. Options that have not been exercised will be forfeited after expiry of the exercise period. Outstanding options as of 31 December 2010: Date of grant No. of options Exercise price Ratio Vesting period Exercise period CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years CHF : 1 2 years For the options that had been granted in the years out of the option programme of Meyer Burger Technology Ltd, the number of options and the exercise prices were adjusted in January 2010 in the same ratio (1:10) as the share split of the registered shares took place (ratio of 1:10). 2 On the date of the merger between the Company and 3S Industry Ltd on 15 January 2010, 3S Industry Ltd had a total of 930,050 options outstanding, which were exercisable into one 3S share each. Out of this total, 625,100 of these options were directly exercisable, whereas 304,950 options were not exercisable yet. Meyer Burger Technology Ltd allocated with effect from 14 January 2010, out of the existing share capital of the Company, to the beneficiary owners of these options a corresponding amount of options exercisable into shares of the Company in accordance with the exchange ratio of 1.12:1 as agreed in the merger contract. The exercise price was adjusted taking into consideration the exchange ratio and the fact that the beneficiaries should not receive worse conditions than under the existing participation plans of 3S Industries.

49 Report FY 2010 Corporate Governance Financial Report Other Information 45 The 1,578,788 options mentioned in the table correspond to 3.50% of the outstanding ordinary share capital of the Company as of 31 December 2010 (capital registered in the commercial register). Share participation programme (since fiscal year 2010) The Board of Directors approved in December 2009 a new share plan (which was applied for the first time in fiscal year 2010) for the members of the Board of Directors and members of the Executive Board as well as for other selected employees within the Group. The Board of Directors determines the individual participants of the plan at its own discrection. Shares may only be allocated to employees with an employment contract of indefinite term and in positions not under notice, and to serving members of the Board of Directors, who have not submitted their resignation. Each participant receives an individual offer letter, stipulating the number of offered shares being offered, the acquisition price per share, the payment conditions, the period within which the participant has to declare acceptance of the offer, as well as the (optional) retention periods. Within this acceptance period, the participant has to 1) declare acceptance of the offer, 2) declare, which retention period that was set by the Board of Directors, he/she wishes to be applied in acquiring the shares, 3) pay the full acquisition price for all shares, which the participant wishes to acquire. The shares, which the Board of Directors has allocated, have a vesting period of two years and an optional retention period that can be selected by the participant of either zero, three or five years (following the end of the vesting period). During the vesting period and the (optional) retention period, the participants cannot sell (in part or entirely), transfer, pledge or debit the shares in any form. Shares acquired under this plan forfeit in the event that the employee gives his/her notice or the Company ends the employment relationship prior to expiration of the vesting period (subject to special situations such as retirement, death or permanent incapacity for work due to invalidity, etc.). The same rule applies in the event of the voluntary resignation of a member of the Board of Directors (or de-selection by shareholders at a Meeting of Shareholders) prior to expiration of the vesting period. The Board of Directors is also entitled to set different modalities from the above mentioned conditions for participants domiciled outside of Switzerland. It will thereby aim for equal treatment of the participants taking into account the tax differences within the different states of domicile. (Slightly modified conditions are currently applied for employees in Germany (deferred acquisition of ownership, no optional retention period), the USA (no retention period) and in China and Spain, where employees have been offered so-called phantom-shares.) Under the share plan, the following number of shares was offered during fiscal year The vesting period of these shares started on 1 December Date of grant No. of shares Acquisition price Vesting period CHF The 134,230 registered shares mentioned in the table correspond to 0.30% of the outstanding ordinary share capital of the Company as of 31 December 2010 (capital registered in the commercial register).

50 46 Meyer Burger Annual Report 2010 The total amount of share capital for the option and share participation programme together amounts to 3.80% of the outstanding ordinary share capital of the Company as of 31 December Board of Directors The Company s Board of Directors consisted of six members as of 31 December As part of the merger with 3S Industries Ltd, Messrs. Rudolf Samuel Güdel, Rolf Wägli and Prof. Dr. Konrad Wegener were newly elected as members of the Board of Directors. Peter Pauli and Prof. Dr. Eicke Weber stepped down from the Board as of that date. Board of Directors as of 31 December 2010 Name Born Position First elected Elected until AGM Peter M. Wagner 1953 Chairman Dr. Alexander Vogel 1964 Vice Chairman Rudolf Samuel Güdel 1948 Member Heinz Roth 1954 Member Rolf Wägli 1951 Member Prof. Dr. Konrad Wegener 1958 Member Peter M. Wagner Chairman, non executive member of the Board of Directors, German citizen Education Studies in mathematics and physics at the University of Mainz, DE-Mainz Degree in mathematics Software engineer at Alcatel SEL AG (previously Standard Elektrik Lorenz AG), DE-Stuttgart Assistant to the Chief Executive Officer of Alcatel SEL AG, DE-Stuttgart Head of Business Unit Product Strategies and Synergies, Head of Business Unit Telecommunications Systems at Alcatel SEL AG, DE-Stuttgart Managing Director at Wandel & Goltermann Management Holding GmbH, DE-Eningen 1998 Chief Executive Officer of Wandel & Goltermann Management Holding GmbH, DE-Eningen Chief Executive Officer of Wavetek Wandel Goltermann GmbH, DE-Eningen, and President/CEO of Wavetek Wandel Goltermann, Inc., USA-Raleigh/NC Chief Executive Officer of debitel AG, DE-Stuttgart Since 2004 Independent business consultant, DE-Überlingen On ad interim basis: Head of Research & Development at Meyer Burger Ltd, CH-Thun Since 2010 On ad interim basis: Chief Operating Officer at AMB Apparate + Maschinenbau GmbH, DE-Langweid Since 1990, many mandates as a member of supervisory boards or in similar positions at various technology companies and organisations, including: Member of the Board of Directors of Deutsche Messe AG, DE-Hanover; member of the Chairmanship of DEKRA e.v., DE-Stutt

51 Report FY 2010 Corporate Governance Financial Report Other Information 47 gart; member of the Main Board of Directors of the Bundesverband Informationswirtschaft, Telekommunikation und neue Medien e.v. (Federal Association of IT, Telecommunications and New Media), DE-Berlin (BITKOM), and President of the Verband der Anbieter von Telekommunikations- und Mehrwertdiensten e.v. (Association of Telecommunications and Value-Added Services Providers), DE-Cologne/DE-Berlin (VATM); member of the Advisory Board of the Wissenschaftliche Institut für Kommunikationsforschung (Scientific Institute for Communications Research), DE-Bonn (WIK). Current mandates: Chairman of the Board of Directors of DATAGROUP IT Services Holding AG, DE-Pliezhausen; Chairman of the Board of Directors of KEYMILE International GmbH, AT-Vienna; Chairman of the Advisory Board of the Stiftung für konkrete Kunst (Foundation for Concrete Art), DE-Reutlingen. Details to the services as COO of AMB Apparate + Maschinenbau GmbH are available in Note Related party transactions on page 133 of this Annual Report. Dr. Alexander Vogel, LL.M. Vice Chairman, non executive member of the Board of Directors, Swiss citizen Education Studies in business administration and law at the University of St. Gall, CH-St. Gall; Dissertation in the area of company and group law Research project of the national fund in the area of group law Licensed to practice law, licensed notary (Lucerne and Zug) Postgraduate studies (LL.M.) at Northwestern University in Chicago, USA-Chicago Associate at law firm meyerlustenberger in Zurich and Zug Activities in the areas of company and commercial law, as well as banking, financial and capital market law 1994 Active for law firm Mayer Brown & Platt in Chicago, licensed to practice law in New York Since 2000 Partner at law firm meyerlustenberger in Zurich and Zug, Head Practise Group commercial and financial market law, various publications and lectures in commercial and financial market law Member of the Board of Directors of various medium-sized companies in Switzerland. Member of the Board and Secretary of the Swiss Association of Investment Companies (SAIC). No significant official functions or political offices. Meyer Burger obtains consultancy services in legal cases from various law firms, including meyerlustenberger, in which Dr. Vogel is one of several partners. The Executive Board generally decides on awarding mandates to external lawyers without consulting the Board of Directors. Further details are available in Note Related party transactions on page 133 of this Annual Report.

52 48 Meyer Burger Annual Report 2010 Rudolf Samuel Güdel Non executive member of the Board of Directors, Swiss citizen Education Studies in machinery construction at the Federal Institute of Technology (ETH) Zurich, CH-Zurich Master degree on thermal machines (Professor Traupel) 1970 Exchange semester in Korea and practical training in a South Korean power plant 1972 Training to Officer of Swiss Army Efficiency engineer and Assistant to the Manager at the 135-MW-power plant of Alusuisse aluminium plant in Northern Territory, Australia Since 1979 Owner and Delegate of the Board of Directors at Güdel Group Ltd (robotic and automation) and Chief Executive Officer of Güdel Ltd, CH-Langenthal Member of the Board of Directors of 3S Industries Ltd until the merger with Meyer Burger Technology Ltd. Member of the Board of Directors of VDMA Sector Robotics and Visions, DE-Frankfurt. Founding member of EUnited, BE-Bruxelles. Member of the Advisory Board of University of Applied Science in CH-Berne (BUAS). No further Board of Directors memberships or consultancy activities for important Swiss or foreign organisations. No significant official functions or political offices. The Company procures services from/performs services to Güdel Group. The Executive Board generally decides on the size of cooperation with Güdel Group without consulting the Board of Directors. Further details are available in Note Related party transactions on page 133 of this Annual Report. Heinz Roth Non executive member of the Board of Directors, Swiss citizen Education Business School, Swiss Certified Banker, Graduate of Swiss Banking School Various management positions (international and within Switzerland) at Credit Suisse Group, including Key Account Manager Corporate Banking, Head Region Zurich North-West, Member of the Executive Board of Credit Suisse Private Banking and Head Central/Northern/and Eastern Europe, Member of the Executive Board of Credit Suisse Financial Services and CEO Private Banking Switzerland 2002 Executive Program at Stanford University Since 2003 Independent business consultant specialised on the financial sector (mandates as member of the Board of Directors and mandates on a project basis) Member of the Board of Directors of Vontobel Holding Ltd, CH-Zurich, and of Bank Vontobel Ltd, CH-Zurich, from 2004 until 2009 (Member of Audit Committee, Chairman of IT Committee). Member of the Board of Directors of Walter Meier Ltd, CH-Schwerzenbach (Chairman of Audit Committee). Member of the Board of Directors of Banca Arner SA, CH-Lugano. Member of the Board of Directors of various non listed companies in Switzerland and member of different foundation boards. President of the foundation Davos Festival. No significant official functions or political offices. No significant business relationship with the Company or one of its group companies.

53 Report FY 2010 Corporate Governance Financial Report Other Information 49 Rolf Wägli Non executive member of the Board of Directors, Swiss citizen Education Business School, Swiss Certified Banker Activities in Investment Banking and Private Banking with broad international experience, including ten years in management capacities. Positions in Switzerland and internationally at Credit Suisse, Bank Cantrade, Rothschild, Interallianz-Bank, Grindlays and at the Swiss Banking Institute Zurich Since 1990 Independent asset manager (R. Wägli & Cie Ltd) for international private clients Since 2000 Founder and Chairman of the Board of Directors of New Value Ltd, CH-Zurich, a private equity investment company, listed on the SIX Swiss Exchange Chairman of the Board of Directors of 3S Industries Ltd, CH-Lyss Member of the Board of Directors of 3S Industries Ltd (Chairman) until the merger with Meyer Burger Technology Ltd. Chairman of the Board of Directors of New Value Ltd, Zurich. Member of the Board of Directors of various medium-sized companies in Switzerland. No significant official functions or political offices. No significant business relationships with the Company or one of its group companies. Prof. Dr. Konrad Wegener Non executive member of the Board of Directors, German citizen Education Studies in machinery construction and doctorate in the equation of material behaviour of plastics at the Technische Universität (TU) Braunschweig, DE-Braunschweig Schuler Pressen GmbH & Co. KG, DE-Göppingen Tasks in restructuring the construction departments Head of project planning for series machines Divisional Head of technical services Preparation of Schuler s engagement in laser technology Technical CEO of Schuler Laser Technology, DE-Heusenstamm. Development and construction of large-scale welding installations for the ship building and aviation industries, as well as welding and cutting equipment for applications in the construction of vehicle bodywork and fabric cutting machinery Lecturer on tensor calculation and continuum mechanics at TU Braun schweig, and on metal forming technology and machinery in Darmstadt Since 2003 Professor for production technology and tool machinery at the Federal Institute of Technology (ETH) Zurich, CH-Zurich Head of the IWF (Institute for tool machinery and production) as well as inspire Ltd, a transfer centre for production technology at the ETH Zurich Member of the Board of Directors of 3S Industries Ltd until the merger with Meyer Burger Technology Ltd. Member of the Board of the Swiss Association for Welding Technology, member and Delegate of the Board of Directors of inspire Ltd, Zurich. No significant official functions or political offices. No significant business relationship with the Company or one of its group companies.

54 50 Meyer Burger Annual Report 2010 Executive activities for the Company or one of its group companies The non executive members of the Board of Directors, Dr. Alexander Vogel, Rudolf Samuel Güdel, Heinz Roth, Rolf Wägli, and Prof. Dr. Konrad Wegener have never been members of the Executive Board of the Company or one of the group companies. Peter M. Wagner acted as Head of Research & Development at Meyer Burger Ltd on an ad interim basis from July 2007 until mid-december 2008 and has been acting as COO of AMB Apparate + Maschinenbau GmbH since May Elections and terms of office In accordance with the Articles of Association of the Company, the Board of Directors consists of one or more members. The members of the Board of Directors are elected individually for a term of office of three years up to and including the next Annual General Meeting. Re-election is possible. The term of office of a member of the Board of Directors will, however, end irrevocably on the date of the Annual General Meeting following the 70th birthday of the particular member of the Board of Directors. At the Extraordinary Meeting of Shareholders, held on 14 January 2010, Messrs Rudolf Samuel Güdel, Rolf Wägli and Prof. Dr. Konrad Wegener were newly elected as members of the Board of Directors (in individual elections) for a term of office of three years. Peter Pauli and Prof. Dr. Eicke Weber, previously members of the Board of Directors, had agreed to step down from the Board as per 14 January 2010, if the merger with 3S Industries Ltd became effective. 3.2 Internal organisation The Board of Directors constitutes itself. It shall choose a Chairman, one or more Vice Chairman, the members of the Committees and a Secretary. The latter need not be a member of the Board of Directors. If the CEO is a member of the Board of Directors, he will take the role as Delegate of the Board of Directors. Peter M. Wagner has been in office as Chairman of the Board of Directors since September 2006, Vice Chairman is Dr. Alexander Vogel. The Board of Directors holds ordinary Board meetings at least four times per year (usually at least one meeting per quarter). Additional meetings are held as often as necessary. The meetings of the Board of Directors usually last between half a day to an entire day. In fiscal year 2010, the Board of Directors held six Board meetings, one telephone conference and passed two resolutions by means of circular resolution. The CEO and the CFO participated at five of the meetings. The Board of Directors can introduce permanent or ad hoc Committees for the preparation of individual resolutions, for the performance of certain control functions, or for other special tasks. The Committees do not have decision authority, except for special decisions by the Board of Directors in particular cases. The Board of Directors formed three permanent Committees, the Risk & Audit Committee, the Nomination & Compensation Committee and the Mergers & Acquisitions Committee. The duration of the Committee meetings depends on the issues discussed.

55 Report FY 2010 Corporate Governance Financial Report Other Information 51 In addition, the Board of Directors formed a Construction Committee, which accompanies the construction planning of the new headquarters of MB Wafertec (Meyer Burger Ltd). Furthermore, the Board of Directors formed a Technology Advisory Board in fiscal year The duration of the meetings of the Construction Committee and of the Technology Advisory Board depends on the issues discussed. 3.3 Risk & Audit Committee Committee members during fiscal year 2010: Heinz Roth (Chairman), Peter M. Wagner and Dr. Alexander Vogel. The R&A Committee is responsible for the arrangement of accounting, the monitoring of the assessment of risks within the group and the internal control system IKS. The Committee is also responsible for the inspection of the annual financial statements and of other financial information, of insurances, business activities with regard to compliance, the services, independence and fees of the auditors and their recommendations, as well as the services and fees for consulting mandates. The Committee meets as often as business requires, but at least three times a year. The Chief Financial Officer usually participates in these meetings. Other members of the Board of Directors, the Chief Executive Officer or other members of the Executive Board, representatives of the external auditors or other specialists may also be invited to these meetings. The decision thereto is with the Chairman of the R&A Committee. The appointment of assignments to third parties requires the approval of the Board of Directors or, in urgent cases, of the Chairman of the Board of Directors. The Committee meets at least twice per year with representatives of the external auditors. During the length of such a meeting with the auditors none of the members of the Executive Board shall be present. In fiscal year 2010, the R&A Committee held three meetings which lasted between 3.5 to 5 hours, and there were five telephone conferences. The CFO participated at all the meetings and at two of the telephone conferences. The external auditors participated at two of the meetings. No other external advisors participated in any of the meetings. 3.4 Nomination & Compensation Committee Committee members during fiscal year 2010: Rolf Wägli (elected as Chairman at the Board meeting on 25 February 2010, assumed role as Chairman on 24 March 2010), Rudolf Samuel Güdel, Dr. Alexander Vogel (Chairman until 24 March 2010) and Peter M. Wagner. The N&C Committee is in charge of the process for the selection of new members of the Board of Directors and the application process for new members of the Board of Directors and the Executive Board. In addition, the Committee proposes the compensation for the members of the Board of Directors and the Committees of the Board of Directors, as well as for the members of the Executive Board. Finally, the Committee is responsible for the inspection, proposal and monitoring of the implementation of option and share participation plans, as well as for the planning of successors at the highest level of management.

56 52 Meyer Burger Annual Report 2010 The Committee meets as often as business requires (usually at least four times per year). The Chairman of the Committee can invite members of the Executive Board, members of the management of significant subsidiaries or third parties to the meetings. The appointment of assignments to third parties requires the approval of the Board of Directors or the Chairman of the Board of Directors. In fiscal year 2010, the N&C Committee held seven meetings and three telephone conferences. The CEO and the CFO participated at one of the meetings. No external advisors participated in any of the meetings. 3.5 Mergers & Acquisitions Committee Committee members during fiscal year 2010: Peter M. Wagner (Chairman), Heinz Roth, Dr. Alexander Vogel and Rolf Wägli. The M&A Committee is responsible for the preliminary evaluation of material investments (notably purchases of companies) and divestments. It is also responsible for the monitoring and, if needed, the support of the Executive Board in terms of preparation, valuation and pricing, and negotiations in conjunction with investments/divestments and important financial transactions. In addition and whenever needed, the M&A Committee will support the Executive Board in the implementation and integration of investment projects. The Committee meets as often as business requires. The CEO and if possible the CFO usually participate at the meetings of the M&A Committee. The Chairman of the Committee can invite other members of the Board of Directors, other members of the Executive Board, other members of the management of significant subsidiaries or third parties to the meetings. The appointment of assignments to third parties requires the approval of the Board of Directors or the Chairman of the Board of Directors. In fiscal year 2010, the M&A Committee held one meeting and four telephone conferences. The CEO participated at each of the telephone conferences, the CFO at the one meeting and at three of the telephone conferences. The Committee has selectively invited external advisors to support them in certain projects. 3.6 Construction Committee Committee members during fiscal year 2010 (since February 2010): Rudolf Samuel Güdel (Chairman), Heinz Roth and Dr. Alexander Vogel. The Committee was established by the Board of Directors in February 2010 and supervises the construction planning of the new headquarters of Meyer Burger Ltd in Thun. The Committee accompanies and supports the Project Steering Board of the Executive Board of MB Wafertec (Meyer Burger Ltd), Thun. It supervises the operations of the project management and controls the financing of the project. The Committee has continuously accompanied the project and examined the regular, written reports of the project management. Thereafter, the Committee reported about the project at the next meeting of the Board of Directors. In fiscal year 2010, there were three telephone conferences with all members of the Committee and several decisions were taken by circular resolution.

57 Report FY 2010 Corporate Governance Financial Report Other Information Technology Advisory Board Committee members during fiscal year 2010 (since February 2010): Prof. Dr. Eicke Weber (Director of the Fraunhofer Institute for Solar Energy Systems ISE, DE-Freiburg, and Professor of Mathematics and Physics and of Applied Sciences at the Albert Ludwigs University, DE-Freiburg), Dr. Patrick Hofer-Noser (Chief Technology Officer and Deputy CEO of Meyer Burger Technology Ltd), Sylvère Leu (Chief Innovation Officer of Meyer Burger Technology Ltd), Ralf Preu (Head of PV production technology and quality assurance at the Fraunhofer Institute for Solar Energy Systems ISE, DE-Freiburg) and Prof. Dr. Konrad Wegener (Professor for production technology and tool machinery at the Federal Institute of Technology (ETH) Zurich, CH-Zurich, and Head of the IWF and of inspire Ltd, a transfer centre for production technology at the ETH Zurich; Member of the Board of Directors of Meyer Burger Technology AG). The Technology Advisory Board was established by the Board of Directors in February The Advisory Board will usually meet four times per year for meetings that shall last for an entire day; three meetings were held in fiscal year The Technology Advisory Board ensures that the Board of Directors and the Executive Board are aware of the development trends in the solar industry and of potential new processes, in order for Meyer Burger Group to invest into the most promising industry potentials at the right time. The Advisory Board can act in an advisory capacity during M&A projects, if it is mandated by the Executive Board to do so. The Technology Advisory Board focuses on processes along the value chain of Photovoltaic, which have a competitive advantage with regards to cost of ownership and potential further cost reductions. The Advisory Board regularly informs the Board of Directors and the Executive Board and prepares a detailed report regarding the R&D activities of Meyer Burger Group once per year (towards the end of the year). 3.8 Definition of areas of responsibility The main tasks of the Board of Directors are the determination and periodic inspection of the corporate strategy, Company policy, as well as the organisation (including controlling systems) of the group, the control of the operative management and of the risk management. In addition, it is responsible for the periodic assessment of its own performance and that of the Executive Board. In general, the Board of Directors has fully delegated the operational management of the group to the CEO and the Executive Board, respectively. The Board of Directors explicitly reserved the approval of the following circumstances to itself: Incorporation/financing/closing of subsidiaries; investments into/divestments of participations, changes in participation quotas or of share ownership ratios; purchase of a business or a company or parts thereof through the acquisition of assets or of assets and liabilities (including workforce); opening balance sheet of business parts that shall be transferred to subsidiaries, as well as concept and main details of contracts between group companies Contracts/cancellation of contracts regarding strategic alliances that have an influence on the business scope, geographic scope or the capital structure of Meyer Burger Technology Ltd or any of its group companies

58 54 Meyer Burger Annual Report 2010 Decisions on business affairs that are of major importance to Meyer Burger Group Individual expenditures, investments, divestments; sale of assets, abandonment of plants or assets, liquidation of investments, waiving of receivables; grant of sales reductions or adjustments to invoices as long as there is assurance that defined budgeted targets (Sales, EBIT) for the year are reached; write-off of receivables as long as there is assurance that defined budgeted targets (Sales, EBIT) for the year are reached: Above CHF 1.5 million, if included in the budget; above CHF 1 million, if not included in the budget Agreements to and allowance of letter of comforts and guarantees Credit limits, loans to third parties Financing transactions (bank loans, bonds issues), leasing above CHF 5 million Structured financing transactions Decisions concerning communication (Identity, design, branding, communication policy, marketing communication strategy) Personnel and salary policy of the group Wage negotiations and social plans for the group Appointment, dismissal and compensation of members of the Executive Board Employment conditions for highest level of management positions Share and option programmes, including programmes of profit sharing for associates and employees Principles for pension plans and social benefits Large restructuring programmes Members of the Board of Directors and the members of the Executive Board of the Company have joint signature authority. 3.9 Information and control instruments vis-à-vis the Executive Board The Board of Directors receives from the Executive Board a report on business development and on the key figures for all group companies, every month as part of a structured information system. The information relates in particular to: Detailed monthly reports and consolidated monthly financial statements (including key figures for the group) Information on incoming orders, order backlog, situation of inventory, production data, development of employees, liquidity of the group The members of the Board of Directors also receive the following information on a quarterly basis and during Board meetings: Consolidated quarterly financial statements and quarterly reports (financial figures are compared with the budget and the results for the previous year s period) Interim reports on the course of business at each meeting of the Board of Directors Information on the business and market development at each meeting of the Board of Directors Appropriate information with regard to events, which concern the internal control system and the risk management, respectively, at each meeting of the Board of Directors

59 Report FY 2010 Corporate Governance Financial Report Other Information 55 At those Board of Directors meetings, at which financial results are discussed, both the CEO and the CFO participate during the meetings. During Board meetings, each member of the Board of Directors can request information from the other members of the Board, as well as from the members of the Executive Board on all affairs of the Company. Outside of Board meetings, each member of the Board of Directors can request information on the course of business or important business transactions from the CEO, the CFO or from other members of the Executive Board. If approved by the Chairman, the members of the Board of Directors can also contact members of the management of group companies and request access to business documents. In case that the Chairman denies such contact or access to documents, the Board of Directors will decide upon the matter. The Board of Directors approved an optimised internal control System ( IKS ), which has become effective as of 1 January The IKS applies a risk oriented approach (focused on major risks and control). The scope of the IKS depends on the size and risks of each subsidiary within the group. Each subsidiary of Meyer Burger is classified as a Full Scope or Limited Scope company. This classification is reviewed once per year. For the Full Scope companies, the key risks are continuously monitored and every three years, all control measures of the major processes that are relevant for the financial reporting will be reviewed with regards to their effectiveness. For the Limited Scope companies, the controls shall be executed in accordance to a plan that will be defined on a yearly basis. On the group level, controls are implemented with regards to the consolidated financial statements of the group. The following processes were defined as financially relevant: Sales, materials management, production, fixed assets, payroll accounting, finance department, information technology. For each of these processes, a particular IKS person has been defined as the responsible person for the process. For an evaluation of the companywide controls in accordance with the scope, the Executive Board of each group subsidiary executes a self-assessment each year during the first half of the year. Measures that result out of the evaluation are implemented until the end of the respective year. The Board of Directors receives an IKS report once per year. The external auditors also audit as part of their annual audit the compliance of IKS regulations and report their conclusions directly to the Risk & Audit Committee as well as to the Board of Directors. The Company also has an internal audit, which is independent and reports directly to the Risk & Audit Committee. The internal audit ensures that it is continuously informed about all important activities, plans, projects, instructions, rules, regulations, etc. of the group. To ensure the effectiveness of its supervisory tasks, the internal audit can conduct audits, review any document and demand that all information it asks for is provided. The internal audit is obliged to immediately report possible irregularities or fundamental shortcomings to the Risk & Audit Committee. It defines a detailed audit programme (in respect of business affairs, timing, personnel involved) once per year, which has to be approved by the Risk & Audit Committee prior to the conduct of the audit. The results of each audit have to be reported to the Risk & Audit Committee in written format (as an audit report). Once per year, the Risk & Audit Committee also receives a written report, reflecting the activities of the internal audit. The internal audit strives for a cooperation with the external auditors that ensures both, a maximal benefit of the cooperation and a mutual independence of both parties.

60 56 Meyer Burger Annual Report 2010 Board of Directors From top left to bottom right: Peter M. Wagner, Dr. Alexander Vogel, Heinz Roth, Rudolf Samuel Güdel, Rolf Wägli, Prof. Dr. Konrad Wegener

61 Report FY 2010 Corporate Governance Financial Report Other Information 57 Executive Board From top left to bottom right: Peter Pauli, Dr. Patrick Hofer-Noser, Michel Hirschi, Sylvère Leu