Canadian Solar Inc. (CSIQ) 2015年年度報告「NASDAQ」.pdf

《Canadian Solar Inc. (CSIQ) 2015年年度報告「NASDAQ」.pdf》由會員分享，可在線閱讀，更多相關《Canadian Solar Inc. (CSIQ) 2015年年度報告「NASDAQ」.pdf（247頁珍藏版）》請在三個皮匠報告上搜索。

1、Use these links to rapidly review the documentTable of Contents CANADIAN SOLAR INC.INDEX TO CONSOLIDATED FINANCIAL STATEMENTSTable of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549Form 20-FCommission file number:001-33107CANADIAN SOLAR INC.(Exact name of Registrant as sp

2、ecified in its charter)N/A(Translation of Registrants name into English)Canada(Jurisdiction of incorporation or organization)545 Speedvale Avenue WestGuelph,Ontario,Canada N1K 1E6(Address of principal executive offices)Michael G.Potter,Chief Financial Officer545 Speedvale Avenue WestGuelph,Ontario,C

3、anada N1K 1E6Tel:(1-519)837-1881Fax:(1-519)837-2550(Name,Telephone,E-mail and/or Facsimile number and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Securities registered or to be registered pursuant to Section 12(g)of the Act:(Mark On

4、e)o REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIES EXCHANGE ACT OF 1934 OR ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31,2015 ORo TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES

5、EXCHANGE ACT OF 1934 For the transition period from to ORo SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring this shell company reportTitle of Each Class Name of Each Exchange on Which RegisteredCommon shares with no par value The NASD

6、AQ Stock Market LLC (The NASDAQ Global Select Market)None(Title of Class)Securities for which there is a reporting obligation pursuant to Section 15(d)of the Act:None(Title of Class)Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of

7、 the period covered by the annual report.55,965,443 common shares issued and outstanding which were not subject to restrictions on voting,dividend rights and transferability,as of December 31,2015.Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the

8、Securities Act.Yes No o If this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)of the Securities Exchange Act of1934.Yes o No Indicate by check mark whether the registrant(1)has filed all reports requir

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

10、the registrant has submitted electronically and posted on its corporate Web site,if any,every Interactive Data File required to be submitted and posted pursuant toRule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was requ

11、ired to submit and post such files).Yes No o Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,or a non-accelerated filer.See definition of accelerated filer and large accelerated filer in Rule 12b-2 of theExchange Act.(Check one):Indicate by check mark

12、which basis of accounting the registrant has used to prepare the financial statements included in this filing:U.S.GAAP International Financial Reporting Standards as issued by the International Accounting Standards Board o Other o If Other has been checked in response to the previous question,indica

13、te by check mark which financial statement item the registrant has elected to follow.Item 17 o Item 18 o If this is an annual report,indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes o No (APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUP

14、TCY PROCEEDINGS DURING THE PAST FIVE YEARS)Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12,13 or 15(d)of the Securities Exchange Act of 1934 subsequent to the distribution ofsecurities under a plan confirmed by a court.Yes o No oL

15、arge accelerated filer Accelerated filer o Non-accelerated filer oTable of Contents Table of Contents Page INTRODUCTION 1 FORWARD-LOOKING INFORMATION 2 PART I 3 ITEM 1.IDENTITY OF DIRECTORS,SENIOR MANAGEMENT AND ADVISERS 3 ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE 3 ITEM 3.KEY INFORMATION 3 ITE

16、M 4.INFORMATION ON THE COMPANY 41 ITEM 4A.UNRESOLVED STAFF COMMENTS 66 ITEM 5.OPERATING AND FINANCIAL REVIEW AND PROSPECTS 66 ITEM 6.DIRECTORS,SENIOR MANAGEMENT AND EMPLOYEES 103 ITEM 7.MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 120 ITEM 8.FINANCIAL INFORMATION 121 ITEM 9.THE OFFER AND LISTIN

17、G 125 ITEM 10.ADDITIONAL INFORMATION 126 ITEM 11.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 135 ITEM 12.DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 136 PART II 137 ITEM 13.DEFAULTS,DIVIDEND ARREARAGES AND DELINQUENCIES 137 ITEM 14.MATERIAL MODIFICATIONS TO THE RIGHTS OF SE

18、CURITY HOLDERS AND USE OFPROCEEDS 137 ITEM 15.CONTROLS AND PROCEDURES 137 ITEM 16A.AUDIT COMMITTEE FINANCIAL EXPERT 139 ITEM 16B.CODE OF ETHICS 139 ITEM 16C.PRINCIPAL ACCOUNTANT FEES AND SERVICES 140 ITEM 16D.EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 140 ITEM 16E.PURCHASES OF EQUITY

19、 SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 140 ITEM 16F.CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT 140 ITEM 16G.CORPORATE GOVERNANCE 140 ITEM 16H.MINE SAFETY DISCLOSURE 140 PART III 141 ITEM 17.FINANCIAL STATEMENTS 141 ITEM 18.FINANCIAL STATEMENTS 141 ITEM 19.EXHIBITS 141 SIGNATURES 143 Ta

20、ble of Contents INTRODUCTION Unless otherwise indicated,references in this annual report on Form 20-F to:CSI,we,us,our company and our are to Canadian Solar Inc.,a Canadian company,its predecessor entities and its consolidatedsubsidiaries;$,US$and U.S.dollars are to the legal currency of the United

21、States of America,or U.S.;RMB and Renminbi are to the legal currency of China;C$and Canadian dollars are to the legal currency of Canada;and Euro are to the legal currency of the Economic and Monetary Union of the European Union;and British pounds are to the legal currency of the United Kingdom;,JPY

22、 and Japanese yen are to the legal currency of Japan;W,kW,MW and GW are to watts,kilowatts,megawatts and gigawatts,respectively;AC and DC are to alternating current and direct current,respectively;PV is to photovoltaic.The photovoltaic effect is a process by which sunlight is converted into electric

23、ity;EPC is to engineering,procurement and construction;O&M services is to operation and maintenance services;shares and common shares are to common shares,with no par value,of Canadian Solar Inc.;China and the PRC are to the Peoples Republic of China,excluding,for the purposes of this annual report

24、on Form 20-F,Taiwan and thespecial administrative regions of Hong Kong and Macau;and EU refers to the European Union.This annual report on Form 20-F includes our audited consolidated financial statements for the years ended December 31,2013,2014 and 2015 and as ofDecember 31,2014 and 2015.We use the

25、 noon buying rate in The City of New York for cable transfers in Renminbi,Euros,British pounds,Japanese yen and Canadian dollars per U.S.dollar as certified for customs purposes by the Federal Reserve Bank of New York to translate Renminbi,Euros,British pounds,Japanese yen and Canadiandollars to U.S

26、.dollars not otherwise recorded in our consolidated financial statements and included elsewhere in this annual report.Unless otherwise stated,the translation of Renminbi,Euros,British pounds,Japanese yen and Canadian dollars into U.S.dollars was made by the noon buying rate in effect onDecember 31,2

27、015,which was RMB6.4778 to$1.00,0.9209 to$1.00,0.6782 to$1.00,120.27 to$1.00 and C$1.3839 to$1.00.We make norepresentation that the Renminbi,Euro,British pounds,Japanese yen,Canadian dollar or U.S.dollar amounts referred to in this annual report on Form 20-Fcould have been or could be converted into

28、 U.S.dollars,Euros,British pounds,Japanese yen,Canadian dollars or Renminbi,as the case may be,at anyparticular rate or at all.See Item 3.Key InformationD.Risk FactorsRisks Related to Our Company and Our IndustryFluctuations in exchange ratescould adversely affect our business,including our financia

29、l condition and results of operations.1Table of Contents FORWARD-LOOKING INFORMATION This annual report on Form 20-F contains forward-looking statements that relate to future events,including our future operating results,our prospectsand our future financial performance and condition,results of oper

30、ations,business strategy and financial needs,all of which are largely based on our currentexpectations and projections.These forward-looking statements are made under the safe harbor provisions of the U.S.Private Securities Litigation ReformAct of 1995.You can identify these statements by terminolog

31、y such as may,will,expect,anticipate,future,intend,plan,believe,estimate,is/are likely to or similar expressions.Forward-looking statements involve inherent risks and uncertainties.These forward-looking statements include,among other things,statements relating to:our expectations regarding the world

32、wide demand for electricity and the market for solar power;our beliefs regarding the importance of environmentally friendly power generation;our expectations regarding governmental support for solar power;our beliefs regarding the rate at which solar power technologies will be adopted and the contin

33、ued growth of the solar power industry;our beliefs regarding the competitiveness of our solar power products and services;our expectations with respect to increased revenue growth and improved profitability;our expectations regarding the benefits to be derived from our supply chain management and ve

34、rtical integration manufacturing strategy;our ability to continue developing our in-house solar components production capabilities and our expectations regarding the timing andproduction capacity of our internal manufacturing programs;our ability to secure adequate volumes of silicon,solar wafers an

35、d cells at competitive cost to support our solar module production;our beliefs regarding the effects of environmental regulation;our future business development,results of operations and financial condition;competition from other manufacturers of solar power products and conventional energy supplier

36、s;our ability to expand our products and services and to successfully grow our energy development and electricity generation segments;our ability to develop,build and sell solar power projects in Canada,the U.S.,Japan,China,Brazil,the United Kingdom and elsewhere;and our beliefs with respect to the

37、outcome of the investigations and litigation to which we are a party.Known and unknown risks,uncertainties and other factors may cause our actual results,performance or achievements to be materially different from anyfuture results,performance or achievements expressed or implied by forward-looking

38、statements.See Item 3.Key InformationD.Risk Factors for adiscussion of some of the risk factors that may affect our business and results of operations.These risks are not exhaustive.Other sections of this annual reportmay include additional factors that could adversely influence our business and fin

39、ancial performance.Moreover,because we operate in an emerging andevolving industry,new risk factors may emerge from time to time.We cannot predict all risk factors,nor can we assess the impact of all or any of these factorson our business or the extent to which any factor,or combination of factors,m

40、ay cause actual results to differ materially from those expressed or implied inany forward-looking statement.We do not undertake any obligation to update or revise the forward-looking statements except as required under applicablelaw.2Table of Contents PART I ITEM 1.IDENTITY OF DIRECTORS,SENIOR MANA

41、GEMENT AND ADVISERS Not applicable.ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable.ITEM 3.KEY INFORMATION A.Selected Financial DataSelected Consolidated Financial and Operating Data The following selected statement of operations data for the years ended December 31,2013,2014 and 2015 a

42、nd balance sheet data as of December 31,2014 and 2015 have been derived from our consolidated financial statements,which are included elsewhere in this annual report on Form 20-F.You shouldread the selected consolidated financial and operating data in conjunction with those financial statements and

43、the related notes and Item 5.Operating andFinancial Review and Prospects included elsewhere in this annual report on Form 20-F.Our selected consolidated statement of operations data for the years ended December 31,2011 and 2012 and our consolidated balance sheet data as ofDecember 31,2011,2012 and 2

44、013 were derived from our consolidated financial statements that are not included in this annual report.All of our financial statements are prepared and presented in accordance with U.S.generally accepted accounting principles,or U.S.GAAP.Our historicalresults are not necessarily indicative of resul

45、ts for any future periods.3 For the years ended,or as of,December 31,2011 2012 2013 2014 2015 (In thousands of$,except share and per share data,and operating dataand percentages)Statement of operations data:Net revenues 1,898,922 1,294,829 1,654,356 2,960,627 3,467,626 Income(loss)from operations 6,

46、833 (142,516)130,816 366,314 247,371 Net income(loss)(90,903)(195,155)45,565 243,887 173,316 Net income(loss)attributable to CanadianSolar Inc.(90,804)(195,469)31,659 239,502 171,861 Earnings(loss)per share,basic (2.11)(4.53)0.68 4.40 3.08 Shares used in computation,basic 43,076,489 43,190,778 46,30

47、6,739 54,408,037 55,728,903 Earnings(loss)per share,diluted (2.11)(4.53)0.63 4.11 2.93 Shares used in computation,diluted 43,076,489 43,190,778 50,388,284 59,354,615 60,426,056 Other financial data:Gross margin 9.6%7.0%16.7%19.6%16.6%Operating margin 0.4%(11.0)%7.9%12.4%7.1%Net margin (4.8)%(15.1)%2

48、.8%8.2%5.0%Table of ContentsB.Capitalization and Indebtedness Not applicable.C.Reasons for the Offer and Use of Proceeds Not applicable.D.Risk FactorsRisks Related to Our Company and Our IndustryWe may be adversely affected by volatile solar power market and industry conditions;in particular,the dem

49、and for our solar power products and servicesmay decline,which may reduce our revenues and earnings.Our business is affected by conditions in the solar power market and industry.In 2010,as the effects of the global financial crisis subsided,demand forsolar power products increased and many manufactu

50、rers increased their production capacity accordingly.In 2011,a decrease in payments to solar powerproducers in the form of feed-in tariffs and other reimbursements,a reduction in available financing and an excess supply of solar modules worldwide putsevere downward pressure on solar module prices in

51、 European and other markets.As a result,many solar power project developers,solar system installers andsolar power product distributors that purchase solar power products,including solar modules from manufacturers like us,were adversely affected and theirfinancial condition weakened.Although our shi

52、pments of solar modules increased year-over-year in 2013,2014 and 2015,average selling prices for our solarmodules declined.Over the past several quarters,oversupply conditions across the value chain,difficult economic conditions in Europe and foreign tradedisputes in the U.S.,Europe,India and China

53、 have affected industry-wide demand and put pressure on average4 For the years ended,or as of,December 31,2011 2012 2013 2014 2015 (In thousands of$,except share and per share data,and operating dataand percentages)Selected operating data:Solar power products sold(in MW)Module segment(1)1,291.5 1,52

54、8.9 1,809.0 2,436.4 4,085.0 Energy development and electricitygeneration segments(2)31.0 14.2 85.0 376.2 298.8 Total 1,322.5 1,543.1 1,894.0 2,812.6 4,383.8 Average selling price(in$per watt)Solar module 1.34 0.77 0.67 0.67 0.58 Balance Sheet Data:Net current assets(liabilities)59,131 (98,046)(59,00

55、3)366,621 (392,231)Total assets 1,879,809 2,259,313 2,453,735 3,072,424 4,417,254 Net assets 466,978 301,583 401,498 729,574 832,510 Long-term borrowings 88,249 214,563 151,392 134,300 606,577 Convertible notes 950 150,000 150,000 Common shares 502,403 502,562 561,242 675,236 677,103 Number of share

56、s outstanding 43,155,767 43,242,426 51,034,343 55,161,856 55,965,443(1)Numbers are calculated after inter-segmentation elimination and represent solar power products sold to third parties.(2)Numbers are calculated after inter-segmentation elimination.Table of Contentsselling prices,resulting in lowe

57、r revenue for many industry participants.If the supply of solar modules grows faster than demand,and if governmentscontinue to reduce financial support for the solar industry and impose trade barriers,demand for our products,as well as our average selling price,could bematerially and adversely affec

58、ted.The solar power market is still at a relatively early stage of development and future demand for solar power products and services is uncertain.Marketdata for the solar power industry is not as readily available as for more established industries,where trends are more reliably assessed from data

59、 gathered overa longer period of time.In addition,demand for solar power products and services in our targeted markets,including Europe,the U.S.,Japan,China,Canada,Brazil and India may not develop or may develop to a lesser extent than we anticipate.Many factors may affect the viability of solar pow

60、er technology andthe demand for solar power products,including:the cost-effectiveness,performance and reliability of solar power products and services,including our solar power projects,compared toconventional and other renewable energy sources and products and services;the availability of governmen

61、t subsidies and incentives to support the development of the solar power industry;the availability and cost of capital,including long-term debt and tax equity,for solar power projects;the success of other alternative energy technologies,such as wind power,hydroelectric power,geothermal power and bio

62、mass fuel;fluctuations in economic and market conditions that affect the viability of conventional and other renewable energy sources,such as increasesor decreases in the prices of oil,gas and other fossil fuels;capital expenditures by end users of solar power products and services,which tend to dec

63、rease when the economy slows;and the availability of favorable regulation for solar power within the electric power industry and the broader energy industry.If solar power technology is not suitable for widespread adoption or if sufficient demand for solar power products and services does not develo

64、p or takeslonger to develop than we anticipate,our revenues may suffer and we may be unable to sustain our profitability.Demand in Europe generally remains weakas a result of reductions in feed-in-tariffs in Germany and the elimination of feed-in-tariffs in Italy,the two largest European markets ove

65、r the past severalyears.Although demand in other regions,including China,Japan,the U.S.and India,as well as many other emerging markets in Asia,the Middle East andAfrica,has offset the decline in European demand,we cannot assure you that this demand will be sustainable or that any recent positive tr

66、ends in supply ordemand balance will persist.We are preparing to potentially form a global Yieldco investment vehicle for our solar power business.If the formation of Yieldco or our management ofYieldco is not successful,our future growth and results of operations may be materially hindered.We are p

67、reparing to potentially form a globally diversified,dividend growth-oriented partnership,or Yieldco,to own,operate and acquire long-termcontracted renewable energy generation assets with consistent cash flows in attractive markets.If successful,we expect to own a general partner interest inYieldco a

68、nd offer economic interests to public shareholders.The cash produced from projects owned by the operating subsidiaries of Yieldco will bedistributed up to Yieldco,which will in turn distribute the cash to Yieldcos public shareholders and,in certain circumstances,to us.Yieldcos strategy is torapidly

69、expand and diversify its portfolio of assets by acquiring,from us and unaffiliated third parties,5Table of Contentsutility-scale solar projects and commercial and industrial distributed solar energy assets,as well as other renewable energy generation assets equipped withproven and reliable technolog

70、ies.We expect that Yieldcos initial target markets will be Canada,Japan,Spain,the United Kingdom and the United States,and other select markets,primarily within the member countries of Organization for Economic Cooperation and Development,or OECD countries.Yieldco would have a right of first offer w

71、ith respect to certain solar power projects developed by us and we expect that it will grow its portfolio throughacquiring these projects,as well as acquiring other solar power and renewable energy projects from third parties.We are expected to continue to provideYieldco with the opportunity to acqu

72、ire additional qualifying projects,subject to certain conditions.In November 2015,we confidentially submitted a draftregistration statement on Form S-1 to the Securities and Exchange Commission,or the SEC,relating to the proposed initial public offering of Yieldco,or theYieldco IPO.We expect to laun

73、ch the Yieldco IPO subject to market and other conditions.While we intend to complete the Yieldco IPO,the offering may be significantly delayed or may not take place at all because of legal,accounting,commercial or marketing risks and considerations.We remain flexible on whether and when to launch Y

74、ieldco and our management constantly monitors themarket conditions and evaluates other strategic alternatives to Yieldco.If the Yieldco IPO is not successful,we may not be able to recuperate the financialand human resources we have invested in the formation of Yieldco and our growth strategy for our

75、 solar power business may be disrupted,which wouldadversely affect our results of operation and distract our management from the operation of our companys other businesses.In the event the market conditionfor the proposed Yieldco IPO remains unfavorable,we may consider selling stakes in our Yieldco

76、projects and/or selling entire projects to third parties.Inaddition,we have no experience in operating or managing Yieldcos.If the Yieldco IPO is completed,we,as the sponsor of Yieldco,may not succeed indelivering satisfactory results to us or the public shareholders of Yieldco,in which case the sto

77、ck price of Yieldco may fall,which could in turn materiallyaffect our financial conditions and results of operations.The execution of our growth strategy depends upon the continued availability of third-party financing arrangements for our customers,which is affectedby general economic conditions.Ti

78、ght credit markets could depress demand or prices for solar power products and services,hamper our expansion andmaterially affect our results of operations.Most solar power projects,including our own,require financing for development and construction with a mixture of equity and third party funding.

79、Thecost of capital affects both the demand and price of solar power systems.A high cost of capital may materially reduce the internal rate of return for solar powerprojects and therefore put downward pressure on the prices of both solar systems and solar modules,which typically comprise a major part

80、 of the cost of solarpower projects.Furthermore,solar power projects compete for capital with other forms of fixed income investments such as government and corporate bonds.Someclasses of investors compare the returns of solar power projects with bond yields and expect a similar or higher internal r

81、ate of return,adjusted for risk andliquidity.Higher interest rates could increase the cost of existing funding and present an obstacle for potential funding that would otherwise spur the growthof the solar power industry.In addition,higher bond yields could result in increased yield expectations for

82、 solar power projects,which would result in lowersystem prices.In the event that suitable funding is unavailable,our customers may be unable to pay for products they have agreed to purchase.It may also bedifficult to collect payments from customers facing liquidity challenges due to either customer

83、defaults or financial institution defaults on project loans.Constricted credit markets may impede our expansion and materially and adversely affect our results of operations.Concerns about government deficits anddebt in the EU have increased bond spreads in certain solar markets,such as Greece,Spain

84、,Italy and Portugal.The cash flow of a solar power project is oftenderived from government-funded or6Table of Contentsgovernment-backed feed-in tariffs.Consequently,the availability and cost of funding solar power projects is determined in part based on the perceivedsovereign credit risk of the coun

85、try where a particular project is located.Therefore,credit agency downgrades of nations in the EU or elsewhere coulddecrease the credit available for solar power projects,increase the expected rate of return compared to bond yields,and increase the cost of debt financing forsolar power projects in c

86、ountries with a higher perceived sovereign credit risk.In light of the uncertainty in the global credit and lending environment,we cannot make assurances that financial institutions will continue to offerfunding to solar power project developers at reasonable costs.An increase in interest rates or a

87、 decrease in funding of capital projects within the globalfinancial market could make it difficult to fund solar power systems and potentially reduce the demand for solar modules and/or reduce the average sellingprices for solar modules,which may materially and adversely affect our business,results

88、of operations,financial condition and prospects.Our future success depends partly on our ability to expand the pipeline of our energy development and electricity generation segments in several keymarkets,which exposes us to a number of risks and uncertainties.Historically,our module segment has acco

89、unted for the majority of our net revenues,including 80.4%,59.0%and 71.8%in 2013,2014 and 2015,respectively.However,we have,in recent years,increased our investment in,and management attention on,(a)our energy development segment,whichconsists primarily of solar power project development,EPC service

90、s and O&M services,and(b)our electricity generation segment,which consists primarilyof holding solar power plants for the purpose of generating and selling electricity to local and national grids.In the future,we intend to grow our energy development and electricity generation segments by holding an

91、d operating more solar projects,includingboth those that we develop and those we acquire from third-parties.As we do,we will be increasingly exposed to the risks associated with these businesses.Further,our future success largely depends on our ability to expand our solar power project pipeline.The

92、risks and uncertainties associated with our energydevelopment and electricity generation segments,and our ability to expand our solar power project pipeline include:the uncertainty of being able to sell the projects,receive full payment for them upon completion,or receive payment in a timely manner;

93、the need to raise significant additional funds to develop greenfield or purchase late-stage solar power projects,which we may be unable toobtain on commercially reasonable terms or at all;delays and cost overruns as a result of a number of factors,many of which are beyond our control,including delay

94、s in regulatory approvals,construction,grid-connection and customer acceptance testing;delays or denial of required regulatory approvals by relevant government authorities;diversion of significant management attention and other resources;and failure to execute our project pipeline expansion plan eff

95、ectively.If we are unable to successfully expand our energy development and electricity generation segments,and,in particular,our solar power project pipeline,we may be unable to expand our business,maintain our competitive position,improve our profitability and generate cash flows.Governments may r

96、evise,reduce or eliminate subsidies and economic incentives for solar energy,which could cause demand for our products to decline.The market for on-grid applications,where solar power supplements the electricity a customer purchases from the utility network or sells to a utilityunder a feed-in tarif

97、f,depends largely on the availability and size of government subsidy programs and economic incentives.At present,the cost of7Table of Contentssolar power exceeds retail electricity rates in many locations.Government incentives vary by geographic market.Governments in many countries,mostnotably Germa

98、ny,Italy,the Czech Republic,the U.S.,Japan,Canada(Ontario),South Korea,India,France,Australia and the United Kingdom,have providedincentives in the form of feed-in tariffs,rebates,tax credits,renewable portfolio standards and other incentives.These governments have implementedmandates to end-users,d

99、istributors,system integrators and manufacturers of solar power products to promote the use of solar energy in on-grid applicationsand to reduce dependency on other forms of energy.Some of these government mandates and economic incentives have been or are scheduled to be reducedor eliminated altoget

100、her.It is likely that this trend will continue,possibly until subsidies for solar energy are phased out completely.While solar power projects may continue to offer attractive internal rates of return,it is unlikely internal rates of return will be as high as they were in thepast.If internal rates of

101、 return fall below an acceptable rate for project investors,and governments continue to reduce or eliminate subsidies,this may cause adecrease in demand and considerable downward pressure on solar systems and therefore negatively impact both solar module prices and the value of our solarpower projec

102、ts.The reduction,modification or elimination of government mandates and economic incentives in one or more of our markets could thereforematerially and adversely affect the growth of such markets or result in increased price competition,either of which could cause our revenues to decline andharm our

103、 financial results.General global economic conditions may have an adverse impact on our operating performance and results of operations.The demand for solar power products and services is influenced by macroeconomic factors,such as global economic conditions,demand for electricity,supply and prices

104、of other energy products,such as oil,coal and natural gas,as well as government regulations and policies concerning the electric utilityindustry,the solar and other alternative energy industries and the environment.As a result of global economic conditions,some governments may implementmeasures that

105、 reduce the feed-in tariffs and other subsidies designed to benefit the solar industry.During 2013,2014 and 2015,a decrease in solar powertariffs in many markets placed downward pressure on the price of solar systems in most regions.In addition,reductions in oil and coal prices may reduce thedemand

106、for and the prices of solar power products and services.For instance,in recent months,oil prices globally have experienced high volatility and,atpoints,have recorded historical lows.We cannot assure you that such volatility and significant reductions in the global price of oil will not have a materi

107、aladverse effect on the demand for and prices of our products.Our growth and profitability depend on the demand for and the prices of solar power productsand services.If these negative market and industry trends continue and demand for solar power projects and solar power products and services weake

108、ns as aresult,our business and results of operations may be adversely affected.Imposition of anti-dumping and countervailing duty orders or safeguard measures in one or more markets may result in additional costs to our customers,which could materially or adversely affect our business,results of ope

109、rations,financial conditions and future prospects.We have been in the past,and may be in the future,subject to the imposition of anti-dumping and countervailing duty orders in one or more of themarkets in which we sell our products.In particular,we have been subject to the imposition of anti-dumping

110、 and countervailing duty orders in the U.S.,theEU and Canada and have,as a result,been party to lengthy proceedings related thereto.See Item 8.Financial InformationA.Consolidated Statements andOther Financial InformationLegal and Administrative Proceedings.The U.S.,EU and Canada are important market

111、s for us.Ongoing proceedings relatingto,and the imposition of any new,anti-dumping and countervailing duty orders or safeguard measures in these markets may result in additional costs to usand/or our customers,which may materially and adversely affect our business,results of operations,financial con

112、ditions and future prospects.8Table of ContentsOur project development and construction activities may not be successful,projects under development may not receive required permits,property rights,power purchase agreements,or PPAs,interconnection and transmission arrangements,and financing or constr

113、uction of projects may not commence orcontinue as scheduled,all of which could increase our costs,delay or cancel a project,and have a material adverse effect on our revenue and profitability.The development and construction of solar power projects involve known and unknown risks.We may be required

114、to invest significant amounts ofmoney for land and interconnection rights,preliminary engineering,permitting,legal and other expenses before we can determine whether a project isfeasible.Success in developing a particular project is contingent upon,among other things:securing land rights and related

115、 permits,including satisfactory environmental assessments;receipt of required land use and construction permits and approvals;receipt of rights to interconnect to the electric grid;availability of transmission capacity,potential upgrade costs to the transmission grid and other system constraints;pay

116、ment of interconnection and other deposits(some of which are non-refundable);negotiation of satisfactory EPC agreements;and obtaining construction financing,including debt,equity and tax credits.In addition,successful completion of a particular project may be adversely affected by numerous factors,i

117、ncluding:delays in obtaining and maintaining required governmental permits and approvals;potential challenges from local residents,environmental organizations,and others who may not support the project;unforeseen engineering problems;subsurface land conditions;construction delays;cost over-runs;labo

118、r,equipment and materials supplyshortages or disruptions(including labor strikes);additional complexities when conducting project development or construction activities in foreign jurisdictions,including compliance withthe U.S.Foreign Corrupt Practices Act and other applicable local laws and customs

119、;and force majeure events,including adverse weather conditions and other events beyond our control.If we are unable to complete the development of a solar power project or we fail to meet any agreed upon system-level capacity or energy outputguarantees or warranties(including 25 year power output pe

120、rformance guarantees)or other contract terms,or our projects cause grid interference or otherdamage,the EPC or other agreements related to the project may be terminated and/or we may be subject to significant damages,penalties and otherobligations relating to the project,including obligations to rep

121、air,replace or supplement materials for the project.We may enter into fixed-price EPC agreements in which we act as the general contractor for our customers in connection with the installation of theirsolar power systems.All essential costs are estimated at the time of entering into the EPC agreemen

122、t for a particular project,and these costs are reflected in theoverall fixed price that we charge our customers for the project.These cost estimates are preliminary and may or may not be covered by contracts between usand the subcontractors,suppliers and other parties involved in the project.In addi

123、tion,we require qualified,licensed subcontractors to install most of oursolar power systems.Shortages of skilled labor could significantly delay a project or otherwise increase our costs.Should miscalculations in planning aproject occur,including those due to unexpected increases in commodity prices

124、 or labor costs,or delays in execution9Table of Contentsoccur and we are unable to increase the EPC sales price commensurately,we may not achieve our expected margins or our results of operations may beadversely affected.Developing solar power projects exposes us to different risks than producing so

125、lar modules.In recent years,we have placed a greater focus on our energy development segment,which includes the development of solar power projects.Theseprojects can take many months or years to complete and may be delayed for reasons beyond our control.They often require us to make significant up-f

126、rontpayments for,among other things,land rights and permitting in advance of commencing construction,and revenue from these projects may not berecognized for several additional months following contract signing.Any inability or significant delays in entering into sales contracts with customers after

127、making such up-front payments could adversely affect our business and results of operations.Furthermore,we may become constrained in our ability tosimultaneously fund our other business operations and the investment in these projects.In contrast to developing solar modules,developing solar power pro

128、jects requires more management attention to negotiate the terms of our engagementand monitor the progress of the projects which may divert managements attention from other matters.Our revenue and liquidity may be adversely affected tothe extent the market for solar power projects weakens or we are n

129、ot able to successfully complete the customer acceptance testing due to technicaldifficulties,equipment failure,or adverse weather,and we are unable to sell our solar power projects at prices and on terms and timing that are acceptable tous.We have a limited history operating our electricity generat

130、ion segment as an independent power producer,or IPP,and may not be successful in growingthis segment.In recent years,we have started operating as an IPP and increasing our investment in our electricity generation segment.Our electricity generationsegment consists primarily of holding solar power pro

131、jects for the purpose of generating and selling electricity to the local or national grid or other powerpurchasers.As an IPP,we are subject to a variety of risks associated with intense market competition,changing regulations and policies,insufficient demandfor solar power,technological advancements

132、 and the failure of our power generation facilities.We face competition from conventional and other renewable energy companies.The solar and renewable energy power industry is highly competitiveand continually evolving as market participants strive to distinguish themselves within their markets and

133、compete with large incumbent utilities and newmarket entrants.See Because the markets in which we compete are highly competitive and quickly evolving,because many of our competitors havegreater resources than we do or are more adaptive,and because we have a limited track record in our energy develop

134、ment and electricity generation segments,we may not be able to compete successfully and we may not be able to maintain or increase our market share.The market for electricity generation in the areas where we operate our electricity generation segment is heavily influenced by national,regional andloc

135、al regulations and policies concerning the electric utility industry.See We are subject to numerous laws and regulations at the national,regional andlocal levels of government in the areas where we do business.Any changes to these regulations and policies may present technical,regulatory and economi

136、cbarriers to the purchase and use of solar power products,solar projects and solar electricity,which may significantly reduce demand for our products andservices or otherwise adversely affect our financial performance.10 Table of Contents The solar power market is still at a relatively early stage o

137、f development and future demand for solar power is uncertain.Market data for the solar powerindustry is not as readily available as for more established industries,where trends are more reliably assessed from data gathered over a longer period of time.In addition,demand for solar power in our target

138、ed markets,including the United States,Japan,Canada,Spain and the United Kingdom,may not develop ormay develop to a lesser extent than we anticipate.The electricity industry is undergoing a transformative change.Technological advancements such as energy storage and distributed generation maychange t

139、he nature of energy generation and delivery.These changes may materially affect our business model as an IPP and our ability to compete with newenergy generation and delivery business models.In addition,our power generation facilities may require periodic upgrading and improvement.Anyunexpected oper

140、ational or mechanical failure,including failure associated with breakdowns and forced outages,and any decreased operational ormanagement performance,could reduce our facilities generating capacity below expected levels,thereby reducing our revenues.We may not be able to enter into PPAs or face delay

141、s in entering into PPAs or may not be able to replace expiring PPAs with contracts on similar terms.We may not be able to enter into PPAs for our solar power projects due to intense competition,increased supply of electricity from other sources,reduction in retail electricity price or other factors.

142、There is a limited pool of potential buyers for electricity generated by our solar power plants since thetransmission and distribution of electricity is either monopolized or highly concentrated in most jurisdictions.The willingness of buyers to purchaseelectricity from an IPP may be based on a numb

143、er of factors and not solely on pricing and surety of supply.If we cannot enter into PPAs on terms favorable tous,or at all,it would negatively impact our revenue and our decisions regarding the development of additional power plants.Generally,to the extent offtakers are not required to acquire the

144、output from our solar power projects under tariff regulations,renewable portfoliostandards or other arrangements,the decision by an end user to buy energy from our solar power projects is primarily driven by a deficit of available energy insuch markets and the availability of domestic resources to m

145、eet those needs in a timely fashion.The end users decision may also be affected by the cost ofother conventional and alternative energy sources.Decreases in the retail prices of electricity supplied by utilities or other alternative energy sources couldharm our ability to offer competitive pricing a

146、nd to sign new customers.An increase in the availability of electricity or reduction in retail electricity prices inour target markets would make the purchase of solar energy less economically attractive.If the availability of energy were to increase or the price ofelectricity were to decrease in th

147、e markets in which we operate,we would be at a competitive disadvantage,we may be unable to attract new customers for ourelectricity generation segment and its growth may be limited.We may experience delays in entering into PPAs for some of our solar power projects or may not be able to replace an e

148、xpiring PPA with a contract onequivalent terms and conditions,or otherwise at prices that permit operation of the related facility on a profitable basis.Any delay in entering into PPAs mayadversely affect our ability to enjoy the cash flows generated by such projects.If we are unable to replace an e

149、xpiring PPA with an acceptable new PPA,theaffected site may temporarily or permanently cease operations,which could materially and adversely affect our electricity generation segment,our financialcondition,results of operations and cash flows.11Table of ContentsCounterparties to our PPAs may not ful

150、fill their obligations,which could result in a material adverse impact on our business,financial condition,resultsof operations and cash flows.Substantially all of the electric power generated by our solar power projects will be sold under long-term PPAs with public utilities,licensed suppliers orco

151、mmercial,industrial or government end users and we expect our future projects will also have long-term PPAs or similar offtake arrangements such as tariffprograms.If,for any reason,any of the purchasers of power under these contracts are unable or unwilling to fulfill their related contractual oblig

152、ations or ifthey refuse to accept delivery of power delivered thereunder or if they otherwise terminate such agreements prior to the expiration thereof,our assets,liabilities,business,financial condition,results of operations and cash flows could be materially and adversely affected.Further,to the e

153、xtent any of ourpower purchasers are,or are controlled by,governmental entities,our facilities may be subject to legislative or other political action that may impair theircontractual performance or contain contractual remedies that do not provide adequate compensation in the event a counterparty de

154、faults.Our PPAs and project-level financing arrangements may contain price adjustment,termination,buy-out,acceleration or other clauses that couldmaterially and adversely affect our electricity generation segment,our financial condition,results of operations and cash flows.Some of our PPAs are subje

155、ct to price adjustments over time.If the price under any of our PPAs is reduced below a level that makes a projecteconomically viable,our electricity generation segment,financial conditions,cash flow and results of operations could be materially and adversely affected.Further,some of our long-term P

156、PAs do not include inflation-based price increases.To the extent that the countries in which we conduct our businessexperience high rates of inflation,thereby increasing our operating costs in those countries,we may not be able to generate sufficient revenues to offset theeffects of inflation.Certai

157、n of the PPAs for our projects and those for projects that we have acquired and may acquire in the future contain or may contain provisions thatallow the offtake purchaser to terminate or buy out the project or require us to pay liquidated damages upon the occurrence of certain events.In addition,ce

158、rtain of our project financing arrangements provide for acceleration upon the occurrence of such events.If these provisions are exercised,our electricitygeneration segment,financial condition,results of operations and cash flows could be materially and adversely affected.Additionally,certain of the

159、project-level financing arrangements for projects allow,and certain of the projects that we may acquire in the future may allow,the lenders or investors to acceleratethe repayment of the financing arrangement in the event that a PPA is terminated or if certain operating thresholds or performance mea

160、sures are not achievedwithin specified time periods.We are therefore subject to the risk of lender or investor termination based on such criteria.Certain of our PPAs and project-level financing arrangements include,and in the future may include,provisions that would permit the counterparty totermina

161、te the contract or accelerate maturity in the event we own,directly or indirectly,less than 50%of the combined voting power or,in some cases,if wecease to be the majority owner,directly or indirectly,of the applicable project subsidiary.Generally,these provisions are,or will be,triggered in the even

162、tthat we own,directly or indirectly,less than 50%of the combined voting power or,in some cases,cease to be the majority owner,directly or indirectly,of theapplicable project subsidiary.As a result,if we cease to control or,in some cases,to be the majority owner of the project subsidiary,the counterp

163、arties couldterminate the PPAs or accelerate the maturity of the financing arrangements.The termination of any of our PPAs or the acceleration of the maturity of any ofour financing arrangements as a result of a change-in-control event could have a material adverse effect on our electricity generati

164、on segment,its financialcondition,results of operations and cash flows.12Table of ContentsIf the supply of solar wafers and cells increases in line with increases in the supply of polysilicon,then the corresponding oversupply of solar cells andmodules may cause substantial downward pressure on the p

165、rices of our products and reduce our revenues and earnings.Silicon production capacity has expanded rapidly in recent years.As a result of this expansion,coupled with the global economic downturn,the solarindustry has experienced an oversupply of high-purity silicon since the beginning of 2009.This

166、has contributed to an oversupply of solar wafers,cells andmodules and resulted in substantial downward pressure on prices throughout the value chain.Demand for solar power products remained soft through 2012but began to pick up in the second half of 2013,and continued to grow in 2014 and 2015.The av

167、erage selling price of our solar modules decreased from$1.34 per watt in 2011 to$0.77 per watt in 2012,$0.67 per watt in 2013 and 2014 and$0.58 per watt in 2015,in large part because the increase in the supplyof solar cells and modules was greater than the increase in the demand,thereby putting pres

168、sure on solar power products across all stages of the value chain.As a result of the decline in the selling prices of our solar modules,our revenue declined in 2012,even though our solar module shipment volume for the yearincreased.In addition,because solar module selling prices declined at a rapid

169、rate,we suffered losses in the form of inventory write-downs,as the market priceof solar modules consistently fell below the carrying cost of our inventory.Lower price realizations and inventory write-downs in 2012 put downwardpressure on our gross profit and operating margins.While we believe that

170、there is a relative balance between capacity and demand at low prices due toindustry consolidation,increases in solar module production in excess of market demand may result in further downward pressure on the price of solar wafers,cells and modules,including our products.Increasing competition coul

171、d also result in us losing sales or market share.Moreover,due to fluctuations in thesupply and price of solar power products throughout the value chain,we cannot assure you that we will be able,on an ongoing basis,to procure silicon,wafers and cells at reasonable costs if any of the above risks mate

172、rializes.If we are unable,on an ongoing basis,to procure silicon,solar wafers and solar cellsat reasonable prices or mark up the price of our solar modules to cover our manufacturing and operating costs,our revenues and margins will be adverselyimpacted,either due to higher costs compared to our com

173、petitors or due to further write-downs of inventory,or both.In addition,our market share coulddecline if our competitors are able to price their products more competitively.Long-term supply agreements may make it difficult for us to adjust our raw material costs should prices decrease.Also,if we ter

174、minate any of theseagreements,we may not be able to recover all or any part of the advance payments we have made to these suppliers and we may be subject to litigation.We have entered into a number of long-term supply agreements with several silicon and wafer suppliers in order to secure a stable su

175、pply of raw materialsto meet our production requirements.These suppliers included GCL-Poly Energy Holdings Limited,or GCL,Neo Solar Power Corp.,or Neo Solar,DeutscheSolar AG,or Deutsche Solar,Jiangxi LDK Solar Hi-Tech Co.,Ltd.,or LDK,and a UMG-Si supplier.In 2009 and thereafter,we amended our agreem

176、ents with certain of these suppliers to adjust the purchase price to prevailing market prices at the time weplace a purchase order and to reduce the quantity of products that we were required to purchase.Under our supply agreements with certain suppliers,andconsistent with historical industry practi

177、ce,we make advance payments prior to scheduled delivery dates.These advance payments are made withoutcollateral and are credited against the purchase prices payable by us.As of December 31,2015,the balance of the advance payments that we have made toGCL,Deutsche Solar,LDK and the UMG-Si supplier tot

178、aled$32.1 million.Under our 12-year wafer supply agreement with Deutsche Solar,we purchased the contracted volume for 2009 but did not purchase the contractedvolumes for 2010 and 2011.The agreement contains a provision stating that,if we do not order the contracted volume in a given year,Deutsche So

179、lar caninvoice us for the difference at the full contract price.We believe that the take-or-pay13Table of Contentsprovisions of the agreement are void under German law.In December 2011,Deutsche Solar gave notice to us to terminate the agreement with immediateeffect.Deutsche Solar stated that the rea

180、son for the termination was an alleged breach of the agreement by us.In the notice,Deutsche Solar reserved its rightto claim damages of 148.6 million in court.As a result of the termination,we reclassified the accrued loss on firm purchase commitments reserve of$27.9 million as of December 31,2011 t

181、o loss contingency accruals.In addition,we made a full bad debt allowance of$17.4 million against the balance ofadvance payments to Deutsche Solar.The accrued amount of$27.9 million represents our best estimate for our loss contingency.Deutsche Solar did notspecify the basis for its claimed damages

182、of 148.6 million in the notice.In 2007,we entered into a three-year agreement,or the 2007 Supply Contract,with LDK under which we purchased specified quantities of silicon wafersand LDK converted our reclaimed silicon feedstock into wafers.In June 2008,we entered into two 10-year wafer supply agreem

183、ents,or the 2008 SupplyContracts,with LDK,under which we agreed to purchase specified volumes of wafers at pre-determined prices each year,commencing January 1,2009.InApril 2010,we gave LDK a termination notice for the 2007 Supply Contract and 2008 Supply Contracts on the grounds that they refused t

184、o deduct from theselling price the deposits paid by us previously.We also initiated arbitration proceedings against LDK under the supply contracts,seeking a refund of theinitial deposits that we paid to them.In December 2012,Shanghai International Economic and Trade Arbitration Commission,formerly k

185、nown as CIETACShanghai Branch,awarded RMB248.9 million($38.4 million)plus RMB2.32 million($0.4 million)in arbitration expenses in favor of LDK,includingRMB60.0 million($9.3 million)of previously paid deposits,or the 2012 Arbitral Award.In February 2013,LDK filed for enforcement of the 2012 ArbitralA

186、ward with Jiangsu Suzhou Intermediate Peoples Court,or the Suzhou Intermediate Court.In 2013,LDK initiated two separate proceedings against us inJiangxi Xinyu Intermediate Peoples Court,or the Xinyu Intermediate Court,claiming that we had forfeited our rights to the initial deposits under the 2007Su

187、pply Contract and 2008 Supply Contracts because of the alleged breaches under these contracts.On October 18,2013,the Xinyu Intermediate Courtstayed these proceedings pending the decision by the Suzhou Intermediate Court as to the 2012 Arbitral Award.On September 9,2015,the SuzhouIntermediate Court r

188、uled in favor of LDK.On October 19,2015,we reached a settlement agreement with LDK,or the 2015 Settlement Agreement.Under the2015 Settlement Agreement,we agreed to pay RMB132.7 million($20.8 million)to LDK and to purchase 64.3 million pieces of silicon wafers from LDK atmarket price over a three yea

189、r period starting in or around December 2015,in exchange for which LDK(a)would release us from the 2012 Arbitration Awardand waive its rights and claims thereunder and(b)would withdraw its complaints from the Xinyu Intermediate Court and terminate such proceedings.TheSuzhou Intermediate Court review

190、ed and approved the 2015 Settlement Agreement and terminated the enforcement proceeding relating to the 2012 ArbitralAward.We have already paid the required amounts and fulfilled our obligations under the 2015 Settlement Agreement.See Item 8.Financial InformationA.Consolidated Statements and Other F

191、inancial InformationLegal and Administrative Proceedings.We recorded a charge of$20.8 million related to the2015 Settlement Agreement in general and administrative expense in the third quarter of 2015.Although we have reached the 2015 Settlement Agreementwith LDK,we cannot assure you that LDK will n

192、ot attempt to bring additional claims against us,the outcomes of which could potentially have an adverseeffect on our results of operations and financial condition.In March 2014,LDK filed an application for arbitration with CIETAC,seeking compensation andenforcement expenses for damages LDK claimed

193、to have suffered from the alleged breaches under the 2008 Supply Contracts between October 2010 andDecember 2013.We filed counterclaims against LDK in July 2014.On December 22,2015,CIETAC ruled to reject both LDKs claims and our counterclaims.Due to the default of a UMG-Si supplier in delivering its

194、 contracted volumes for 2010 and concerns regarding its financial position,we concluded thatwe were not likely to purchase any14Table of Contentssignificant quantity of UMG-Si from this supplier in the future and made a full bad debt allowance against the advance payments of RMB59 million($9.1 milli

195、on)to the UMG-Si supplier in 2010.We have in the past entered,and may in the future,enter into long-term supply agreements for silicon wafers or solar cells with fixed price and quantityterms.If,during the term of these agreements,the price of materials decreases significantly and we are unable to r

196、enegotiate favorable terms with oursuppliers,we may be placed at a competitive disadvantage compared to our competitors,and our earnings could decline.In addition,if demand for our solarpower products decreases,yet our supply agreements require us to purchase more silicon wafers and solar cells than

197、 required to meet customer demand,wemay incur costs associated with carrying excess inventory.To the extent that we are not able to pass these increased costs on to our customers,our business,cash flows,financial condition and results of operations may be materially and adversely affected.If our sup

198、pliers file lawsuits against us for earlytermination of these contracts,such events could be costly,may divert managements attention and other resources away from our business,and could have amaterial and adverse effect on our reputation,business,financial condition,results of operations and prospec

199、ts.We are subject to numerous laws and regulations at the national,regional and local levels of government in the areas where we do business.Any changesto these regulations and policies may present technical,regulatory and economic barriers to the purchase and use of solar power products,solar proje

200、ctsand solar electricity,which may significantly reduce demand for our products and services or otherwise adversely affect our financial performance.We are expanding our international operations and are subject to a variety of laws and regulations,some of which may conflict with each other and all o

201、fwhich are subject to change,including energy regulations,export and import restrictions,tax laws and regulations,environmental regulations,labor laws andother government requirements,approvals,permits and licenses.We also face trade barriers and trade remedies such as export requirements,tariffs,ta

202、xes andother restrictions and expenses,which could increase the prices of our products and make us less competitive in some countries.See Imposition of anti-dumping and countervailing duty orders or safeguard measures in one or more markets may result in additional costs to our customers,which could

203、materially or adversely affect our business,results of operations,financial conditions and future prospects.In the counties where we do business,the market for solar power products,solar projects and solar electricity is heavily influenced by national,state andlocal government regulations and polici

204、es concerning the electric utility industry,as well as policies disseminated by electric utilities.These regulations andpolicies often relate to electricity pricing and technical interconnection of customer-owned electricity generation,and could deter further investment in theresearch and developmen

205、t of alternative energy sources as well as customer purchases of solar power technology,which could result in a significant reductionin the potential demand for our solar power products,solar projects and solar electricity.In our module segment,we expect that our solar power products and their insta

206、llation will continue to be subject to national,state and local regulationsand policies relating to safety,utility interconnection and metering,construction,environmental protection,and other related matters.Any new regulationsor policies pertaining to our solar power products may result in signific

207、ant additional expenses to us,our resellers and customers,which could cause asignificant reduction in demand for our solar power products.In our energy development and electricity generation segments,we are subject to numerous national,regional and local laws and regulations,includingthe Federal Pow

208、er Act,or FPA,the Environmental Protection Act(Ontario)and other statutes altered by the Green Energy and Green Economy Act(Ontario),or GEGEA,in Ontario,Canada,the Electricity Business Act(Denki Jiygo Ho)in Japan and E.U.directives and other regulations in respect of our Europebased projects.15Table

209、 of ContentsChanges in applicable energy laws or regulations,or in the interpretations of these laws and regulations,could result in increased compliance costs or theneed for additional capital expenditures.If we fail to comply with these requirements,we could also be subject to civil or criminal li

210、ability and theimposition of fines.Further,national,regional or local regulations and policies could be changed to provide for new rate programs that undermine theeconomic returns for both new and existing projects by charging additional,non-negotiable fixed or demand charges or other fees or reduct

211、ions in thenumber of projects allowed under net metering policies.National,regional or local government energy policies,law and regulation supporting the creation ofwholesale energy markets is currently,and may continue to be,subject to challenges,modifications and restructuring proposals,which may

212、result inlimitations on the commercial strategies available to us for the sale of our power.Regulatory changes in a jurisdiction where we are developing a project may make the continued development of the project infeasible or economicallydisadvantageous and any expenditure we have made to date on s

213、uch project may be wholly or partially written off.Any of these changes could significantlyincrease the regulatory related compliance and other expenses incurred by the projects and could significantly reduce or entirely eliminate any potentialrevenues that can be generated by one or more of the pro

214、jects or result in significant additional expenses to us,our offtakers and customers,which couldmaterially and adversely affect our business,financial condition,results of operations and cash flows.We also face regulatory risks imposed by various transmission providers and operators,including region

215、al transmission operators and independentsystem operators,and their corresponding market rules.These regulations may contain provisions that limit access to the transmission grid or allocate scarcetransmission capacity in a particular manner,which could materially and adversely affect our business,f

216、inancial condition,results of operations and cashflows.We are also subject to the Foreign Corrupt Practices Act of 1977,or the FCPA,the U.S.domestic bribery statute contained in 18 U.S.C.201,the U.S.Travel Act,the USA PATRIOT Act,and other anti-bribery and anti-money laundering laws in countries in

217、which we conduct activities.We face significantliabilities if we fail to comply with the FCPA and other anticorruption laws that prohibit companies and their employees and third-party intermediaries fromauthorizing,offering,or providing,directly or indirectly,improper payments or benefits to foreign

218、 government officials,political parties,and private-sectorrecipients for the purpose of obtaining or retaining business.We may have direct or indirect interactions with officials and employees of governmentagencies or state-owned or affiliated entities.For example,in China,we may contract with and s

219、ell electricity to the national grid,a state-owned enterprise.Inother countries where we develop,acquire or sell solar projects,we need to obtain various approvals,permits and licenses from the local or nationalgovernments.We can be held liable for the illegal activities of our employees,representat

220、ives,contractors,partners,and agents,even if we do not explicitlyauthorize such activities.Any violation of the FCPA,other applicable anticorruption laws,and anti-money laundering laws could result in whistleblowercomplaints,adverse media coverage,investigations,loss of export privileges,severe crim

221、inal or civil sanctions,which could have a material adverse effect onour business,financial condition,cash flows and reputation.In addition,responding to any enforcement action may result in the diversion of managementsattention and resources,significant defense costs and other professional fees.Bec

222、ause the markets in which we compete are highly competitive and quickly evolving,because many of our competitors have greater resources than wedo or are more adaptive,and because we have a limited track record in our energy development and electricity generation segments,we may not be able tocompete

223、 successfully and we may not be able to maintain or increase our market share.We face intense competition in our module,energy development and electricity generation segments.We have a large number of competitors in our solarmodules business,including non-China-based competitors such as First Solar,

224、Inc.,or First Solar,and SunPower Corporation,or SunPower,16Table of Contentsand China-based competitors such as Trina Solar Limited,or Trina,JinkoSolar Holding Co.,Limited,or Jinko,JA Solar Co.,Limited,or JA Solar,andHanwha Q Cells Co.,Ltd.,or Hanwha Q Cells.Some of our competitors are developing or

225、 are currently producing products based on new solar powertechnologies that may ultimately have costs similar to or lower than our projected costs.These include products based on thin film PV technology,whichrequires either no silicon or significantly less silicon to produce than crystalline silicon

226、 solar modules,such as the ones that we produce,and is lesssusceptible to increases in silicon costs.Some of our competitors have longer operating histories,greater name and brand recognition,access to largercustomer bases,greater resources and significantly greater economies of scale than we do.In

227、addition,some of our competitors may have strongerrelationships or may enter into exclusive relationships with some of the key distributors or system integrators to whom we sell our products.As a result,theymay be able to respond more quickly to changing customer demands or devote greater resources

228、to the development,promotion and sales of their products.Some of our competitors have more diversified product offerings,which may better position them to withstand a decline in demand for solar power products.Some of our competitors are more vertically integrated than we are,from upstream silicon w

229、afer manufacturing to solar power system integration.This mayallow them to capture higher margins or have lower costs.In addition,new competitors or alliances among existing competitors could emerge and rapidlyacquire significant market share.If we fail to compete successfully,our business will suff

230、er and we may not be able to maintain or increase our market share.For our energy development segment,we compete in a more diversified and complicated landscape since the commercial and regulatory environmentsfor solar power project development and operation vary significantly from region to region

231、and country to country.Our primary competitors are local andinternational developers and operators of solar power projects.Some of our competitors may have advantages over us in terms of greater experience orresources in the operation,financing,technical support and management of solar power project

232、s,in any particular markets or in general.We only starteddeveloping solar power projects and growing our energy development segment in recent years.Our energy development segment has a global footprint and develops solar power projects primarily in Canada,Japan,the U.S.,China,Brazil and theUnited Ki

233、ngdom.There is no guarantee that we can compete successfully in the markets we currently operate or the ones we plan to enter in the future.Forexample,in certain of our target markets,such as China,state-owned and private companies have emerged to take advantage of the significant marketopportunity

234、created by attractive financial incentives and favorable regulatory environment provided by the governments.State-owned companies may havestronger relationships with local governments in certain regions and private companies may be more focused and experienced in developing solar powerprojects in th

235、e markets where we compete.Accordingly,we need to continue to be able to compete against both state-owned and private companies in thesemarkets.Our energy development segment also provides EPC and/or O&M services in China,Canada,Australia and other countries.We face intensecompetition from other ser

236、vice providers in those markets.For our electricity generation segment,we believe that our primary competitors in the electricity generation markets in which we operate are theincumbent utilities that supply energy to our potential customers under highly regulated rate and tariff structures.We compe

237、te with these conventionalutilities primarily based on price,predictability of price,reliability of delivery and the ease with which customers can switch to electricity generated by oursolar energy projects.If we cannot offer compelling value to our customers based on these factors,then our energy-b

238、ased business will not grow.Conventional utilities generally have substantially greater financial,technical,operational and other resources than we do.As a result,these competitors maybe able to devote more resources to the research,development,promotion and sale of their products or respond more qu

239、ickly to evolving industry standardsand changes in market conditions than we can.Conventional utilities could also offer other value-added products or services that could help them tocompete with us even if the cost of17Table of Contentselectricity they offer is higher than ours.In addition,a majori

240、ty of conventional utilities sources of electricity is non-renewable,which may allow them to sellelectricity more cheaply and deliver energy more consistently or reliably than electricity generated by our solar power projects.We also face risks that conventional utilities could change their volumetr

241、ic-based(i.e.,cents per kilowatt-hour,or kWh)rate and tariff structures to makedistributed solar generation and other renewable forms of energy less economically attractive to their retail customers.For example,net metering programsare currently utilized in most states in the U.S.to support the grow

242、th of distributed generation solar by requiring conventional utilities to reimburse theirretail customers who are home and business owners for the excess power they generate at the level of the utilities retail rates rather than the rates at whichthose utilities buy power at wholesale.However,Arizon

243、a has allowed its largest conventional utility to assess a surcharge on customers that reduces theeconomic returns for the excess electricity that the solar power systems produce.These types of changes or other types of changes that could reduce oreliminate the economic benefits of net-metering coul

244、d be implemented by state public utility commissions or state legislatures in the other states throughoutthe United States that utilize net-metering programs,and could significantly change the economic benefits of solar energy as perceived by conventionalutilities retail customers.As the solar power

245、 and renewable energy industry grows and evolves,we will also face new competitors who are not currently in the market.Our failureto adapt to changing market conditions and to compete successfully with existing or new competitors will limit our growth and will have a material adverseeffect on our bu

246、siness and prospects.We face risks associated with the marketing,distribution and sale of our solar power products and services internationally.The international marketing,distribution and sale of our products expose us to a number of risks,including:fluctuating sources of revenues;difficulties in s

247、taffing and managing overseas operations;fluctuations in foreign currency exchange rates;differing regulatory and tax regimes across different markets;the increased cost of understanding local markets and trends and developing and maintaining an effective marketing and distribution presencein variou

248、s countries;the difficulty of providing customer service and support in various countries;the difficulty of managing our sales channels effectively as we expand beyond distributors to include direct sales to systems integrators,endusers and installers;the difficulty of managing the development,const

249、ruction and sale of our solar power projects on a timely and profitable basis as a result oftechnical difficulties,commercial disputes with our customers and changes in regulations,among other factors;the difficulties and costs of complying with the different commercial,legal and regulatory requirem

250、ents in the overseas markets in which weoperate;any failure to develop appropriate risk management and internal control structures tailored to overseas operations;any inability to obtain,maintain or enforce intellectual property rights;any unanticipated changes in prevailing economic conditions and

251、regulatory requirements;and18Table of Contentsany trade barriers such as export requirements,tariffs,taxes and other restrictions and expenses,which could increase the prices of our productsand make us less competitive in some countries.If we are unable to effectively manage these risks,our ability

252、to expand our business abroad could suffer.Our revenue sources have fluctuated significantly over recent years.For example,in 2008,89.5%of our revenues were attributable to Europe,while only4.6%and 5.9%were attributable to the Americas and Asia and others,respectively.However,in 2014,the Americas co

253、ntributed 60.6%and Asia contributed30.6%of our revenues,while Europe and other regions contributed only 8.8%;and in 2015,the Americas contributed 50.5%and Asia contributed 39.9%ofour revenues,while Europe and other regions contributed 9.6%.As we shift the focus of our operations between different re

254、gions of the world,we havelimited time to prepare for and address the risks identified above.Furthermore,some of these risks,such as currency fluctuations,will increase as our revenuecontribution from certain global regions becomes more prominent.This may adversely influence our financial performanc

255、e.Our future business depends in part on our ability to make strategic acquisitions,investments and divestitures and to establish and maintain strategicrelationships,and our failure to do so could have a material and adverse effect on our market penetration and revenue growth.We frequently look for

256、and evaluate opportunities to acquire other businesses,make strategic investments or establish strategic relationships with thirdparties to improve our market position or expand our products and services.When market conditions permit and opportunities arise,we may also considerdivesting part of our

257、current business to focus management attention and improve our operating efficiency.Investments,strategic acquisitions andrelationships with third parties could subject us to a number of risks,including risks associated with integrating their personnel,operations,services,internalcontrols and financ

258、ial reporting into our operations as well as the loss of control of operations that are material to our business.If we divest any material partof our business,particularly our upstream manufacturing business or downstream energy development and electricity generation businesses,we may not beable to

259、benefit from our investment and experience associated with that part of the business and may be subject to intensified concentration risks with lessflexibility to respond to market fluctuations.Moreover,it could be expensive to make strategic acquisitions,investments,divestitures and establish andma

260、intain relationships,and we may be subject to the risk of non-performance by a counterparty,which may in turn lead to monetary losses that materiallyand adversely affect our business.We cannot assure you that we will be able to successfully make strategic acquisitions and investments and successfull

261、yintegrate them into our operations,or make strategic divestitures or establish strategic relationships with third parties that will prove to be effective for ourbusiness.Our inability to do so could materially and adversely affect our market penetration,our revenue growth and our profitability.Our

262、significant international operations expose us to a number of risks,including unfavorable political,regulatory,labor and tax conditions in thecountries where we operate.We intend to continue to extend our global reach and capture market share in various global markets.In doing so,we will be exposed

263、to various risks,including political,regulatory,labor and tax risks.Furthermore,we may need to make substantial investments in our overseas operations,both initially andon an ongoing basis,in order to attain longer-term sustainable returns.These investments could negatively impact our financial perf

264、ormance beforesustainable profitability is recognized.19Table of ContentsWe face risks related to private securities litigation.Our company and certain of our directors and executive officers were named as defendants in class action lawsuits in the U.S.and Canada alleging thatour financial disclosur

265、es during 2009 and early 2010 were false or misleading and in violation of U.S.federal securities laws and Ontario securities laws,respectively.The lawsuits in the U.S.were consolidated into one class action,which was dismissed with prejudice by the district court in March 2013,andsubsequently affir

266、med by the circuit court in December 2013.The lawsuit in Canada continues.As a preliminary matter,we challenged the Ontario Courtsjurisdiction to hear the plaintiffs claim,but this motion was unsuccessful.In September 2014,the plaintiff obtained an order granting him leave to assert thestatutory cau

267、se of action under the Ontario Securities Act for certain of his misrepresentation claims.In January 2015,the plaintiff obtained an order for classcertification in respect of the claims for which he obtained leave to assert the statutory cause of action under the Ontario Securities Act,for certain n

268、egligentmisrepresentation claims and for oppression remedy claims advanced under the Canada Business Corporations Act,or CBCA.The Court dismissed CSIsapplication for leave to appeal.The class action has moved to the merits stage.See Item 8.Financial InformationA.Consolidated Statements and OtherFina

269、ncial InformationLegal and Administrative Proceedings.There is no guarantee that we will not become party to additional lawsuits.If the case goes totrial,the Canadian action could require significant management time and attention and result in significant legal expenses.In addition,we are generallyo

270、bligated,to the extent permitted by law,to indemnify our directors and officers who are named defendants in these lawsuits.If we were to lose a class actionlawsuit,we may be required to pay judgments or settlements and incur expenses in aggregate amounts that could have a material and adverse effect

271、 on ourfinancial condition or results of operations.Our quarterly operating results may fluctuate from period to period.Our quarterly operating results may fluctuate from period to period based on a number of factors,including:the average selling prices of our solar power products and services;the t

272、iming of completion of construction of our solar power projects;changes in payments from power purchasers of solar power plants already in operation;the rate and cost at which we are able to expand our internal production capacity;the availability and cost of solar cells and wafers from our supplier

273、s and toll manufacturers;the availability and cost of raw materials,particularly high-purity silicon;changes in government incentive programs and regulations,particularly in our key and target markets;the unpredictable volume and timing of customer orders;the loss of one or more key customers or the

274、 significant reduction or postponement of orders;the availability and cost of external financing for on-grid and off-grid solar power applications;acquisition and investment costs;the timing of successful completion of customer acceptance testing of our solar power projects;geopolitical turmoil and

275、natural disasters within any of the countries in which we operate;foreign currency fluctuations,particularly in Euro,RMB,Canadian dollar and Japanese yen;our ability to establish and expand customer relationships;20Table of Contentschanges in our manufacturing costs;the timing of new products or tec

276、hnology introduced or announced by our competitors;fluctuations in electricity rates due to changes in fossil fuel prices or other factors;allowances for doubtful accounts and advances to suppliers;inventory write-downs;long-lived asset impairment;depreciation charges relating to under-utilized asse

277、ts;loss on firm purchase commitments under long-term supply agreements;and construction progress of solar power projects and related revenue recognition.We base our planned operating expenses in part on our expectations of future revenues.A significant portion of our expenses will be fixed in the sh

278、ort-term.If our revenues for a particular quarter are lower than we expect,we may not be able to reduce our operating expenses proportionately,which wouldharm our operating results for the quarter.As a result,our results of operations may fluctuate from quarter to quarter and our interim and annual

279、financialresults may differ from our historical performance.Fluctuations in exchange rates could adversely affect our business,including our financial condition and results of operations.The majority of our sales in 2014 and in 2015 were denominated in U.S.dollars,Canadian dollars and Japanese yen,w

280、ith the remainder in othercurrencies such as Renminbi,Euros and Australian dollars.Our Renminbi costs and expenses are primarily related to the sourcing of solar cells,silicon wafersand silicon,other raw materials,toll manufacturing fees,labor costs and local overhead expenses within the PRC.From ti

281、me to time,we enter into loanarrangements with Chinese commercial banks that are denominated primarily in Renminbi or U.S.dollars.Most of our cash and cash equivalents andrestricted cash are denominated in Renminbi.Fluctuations in exchange rates,particularly between the U.S.dollar,Euro,Renminbi,Cana

282、dian dollar andJapanese yen,may result in foreign exchange gains or losses.We recorded net foreign exchange losses of$51.5 million and$32.2 million in 2013 and 2014,respectively,and a net foreign exchange gain of$22.9 million in 2015.The value of the Renminbi against the U.S.dollar,Euro and other cu

283、rrencies is affected by,among other things,changes in Chinas political andeconomic conditions and Chinas foreign exchange policies.In late 2005,China amended its policy of tracking the value of the Renminbi to the U.S.dollarto instead fluctuate against a basket of foreign currencies,which caused the

284、 Renminbi to appreciate significantly against the U.S.dollar over the followingthree years.In June 2010,the PRC government announced that it would allow greater flexibility for the Renminbi to fluctuate against the U.S.dollar,whichresulted in further appreciation of the Renminbi,although in 2014,the

285、 value of the Renminbi depreciated against the U.S.dollar.In 2015,the PRCgovernment changed the way it calculates the mid-point price of Renminbi against the U.S.dollar,requiring the market-makers who submit for the PeoplesBank of Chinas reference rates to consider the previous days closing spot rat

286、e and foreign-exchange demand and supply,as well as changes in majorcurrency rates.This change resulted in further depreciation of the Renminbi against the U.S.dollar.We cannot provide any assurances that the policy of thePRC government will not affect or the manner in which it may affect the exchan

287、ge rate between the Renminbi and the U.S.dollar or other foreign currenciesin the future.Since 2008,we have hedged part of our foreign currency exposures against the U.S.dollar using foreign currency forward or option contracts.In additionto collateral requirements to enter into hedging contracts,th

288、ere are notional limits on the size of the hedging transactions that we may enter21Table of Contentsinto with any particular counterparty at any given time.The effectiveness of our hedging program may be limited due to cost effectiveness,cashmanagement,exchange rate visibility and downside protectio

289、n.We recorded gains on change in foreign currency derivatives of$10.8 million and$19.7 million in 2013 and 2014,respectively,and a loss on change in foreign currency derivatives of$3.7 million in 2015.The gains or losses on change inforeign currency derivatives are related to our hedging program.Vol

290、atility in foreign exchange rates will hamper,to some extent,our ability to plan our pricing strategy.To the extent that we are unable to pass alongincreased costs resulting from exchange rate fluctuations to our customers,our profitability may be adversely impacted.As a result,fluctuations in forei

291、gncurrency exchange rates could have a material and adverse effect on our financial condition and results of operations.A change in our effective tax rate can have a significant adverse impact on our business.A number of factors may adversely impact our future effective tax rates,such as the jurisdi

292、ctions in which our profits are determined to be earned andtaxed;changes in the valuation of our deferred tax assets and liabilities;adjustments to provisional taxes upon finalization of various tax returns;adjustments to the interpretation of transfer pricing standards;changes in available tax cred

293、its;changes in stock-based compensation expenses;changes intax laws or the interpretation of such tax laws(for example,proposals for fundamental U.S.international tax reform);changes in U.S.GAAP;expiration or theinability to renew tax rulings or tax holiday incentives;and the repatriation of non-U.S

294、.earnings for which we have not previously provided for U.S.taxes.Achange in our effective tax rate due to any of these factors may adversely influence our future results of operations.Seasonal variations in demand linked to construction cycles and weather conditions may influence our results of ope

295、rations.Our business is subject to seasonal variations in demand linked to construction cycles and weather conditions.Purchases of solar power products andservices tend to decrease during the winter months in our key markets,such as Canada,due to adverse weather conditions that can complicate the in

296、stallationof solar power systems and negatively impact the construction schedules of our solar power projects.Demand from other countries,such as the U.S.andChina,may also be subject to significant seasonality.Seasonal variations could adversely affect our results of operations and make them more vo

297、latile andunpredictable.Our future success depends partly on our ability to maintain and expand our solar components manufacturing capacity,which exposes us to a number ofrisks and uncertainties.Our future success depends partly on our ability to maintain and expand our solar components manufacturin

298、g capacity.If we are unable to do so,we maybe unable to expand our business,maintain our competitive position,and improve our profitability.Our ability to expand our solar components productioncapacity is subject to risks and uncertainties,including:the need to raise significant additional funds to

299、purchase raw materials and to build additional manufacturing facilities,which we may beunable to obtain on commercially reasonable terms or at all;delays and cost overruns as a result of a number of factors,many of which are beyond our control,including delays in equipment delivery byvendors;delays

300、or denial of required regulatory approvals by relevant government authorities;diversion of significant management attention and other resources;and failure to execute our expansion plan effectively.If we are unable to maintain and expand our internal production capacity,we may be unable to expand ou

301、r business as planned.Moreover,even if we domaintain and expand our production capacity,we might still not be able to generate sufficient customer demand for our solar power products to support theincreased production levels.22 Table of ContentsWe may be unable to generate sufficient cash flows or h

302、ave access to external financing necessary to fund planned operations and make adequate capitalinvestments.We anticipate that our operating and capital expenditures requirements may increase.To develop new products,support future growth,achieve operatingefficiencies and maintain product quality,we m

303、ay need to make significant capital investments in manufacturing technology,facilities and capitalequipment,research and development,and product and process technology.We also anticipate that our operating costs may increase as we expand ourmanufacturing operations,hire additional personnel,increase

304、 our sales and marketing efforts,invest in joint ventures and acquisitions,and continue ourresearch and development efforts with respect to our products and manufacturing technologies.Our operations are capital intensive.We rely on working capital financing primarily from PRC commercial banks for ou

305、r manufacturing operations.Although we are currently able to obtain new working capital financing from PRC commercial banks,we cannot guarantee that we will continue to be able todo so on commercially reasonable terms or at all.See Our dependence on Chinese banks to extend our existing loans and pro

306、vide additional loansexposes us to funding risks,which may materially and adversely affect our operations.Also,even though we are a publicly-traded company,we may not beable to raise capital via public equity and debt issuances due to market conditions and other factors,many of which are beyond our

307、control.Our ability toobtain external financing is subject to a variety of uncertainties,including:our future financial condition,results of operations and cash flows;general market conditions for financing activities by manufacturers of solar power products;and economic,political and other conditio

308、ns in the PRC and elsewhere.If we are unable to obtain funding in a timely manner and on commercially acceptable terms,our growth prospects and future profitability may beadversely affected.Construction of our solar power projects may require us to obtain project financing.There can be no assurance

309、that we will be able to do so on termsacceptable to us or at all.If we are unable to obtain project financing,or if it is only available on terms which are not acceptable to us,we may be unable tofully execute our business plan.In addition,we generally expect to sell our projects to tax-oriented,str

310、ategic industry and other investors.Such investorsmay not be available or may only have limited resources,in which case our ability to sell our projects may be hindered or delayed and our business,financialcondition,and results of operations may be adversely affected.There can be no assurance that w

311、e will be able to generate sufficient cash flows,find othersources of capital to fund our operations and solar power projects,make adequate capital investments to remain competitive in terms of technologydevelopment and cost efficiency required by our projects.If adequate funds and alternative resou

312、rces are not available on acceptable terms,our ability tofund our operations,develop and construct solar power projects,develop and expand our manufacturing operations and distribution network,maintain ourresearch and development efforts or otherwise respond to competitive pressures would be signifi

313、cantly impaired.Our inability to do the foregoing could havea material and adverse effect on our business and results of operations.We have substantial indebtedness and may incur substantial additional indebtedness in the future,which could adversely affect our financial health andour ability to gen

314、erate sufficient cash to satisfy our outstanding and future debt obligations.We have substantial indebtedness and may incur substantial additional indebtedness in the future,which could adversely affect our financial health andour ability to generate sufficient cash to satisfy23Table of Contentsour

315、outstanding and future debt obligations.Our substantial indebtedness could have important consequences to us and our shareholders.For example,itcould:limit our ability to satisfy our debt obligations;increase our vulnerability to adverse general economic and industry conditions;require us to dedicat

316、e a substantial portion of our cash flow from operations to servicing and repaying our indebtedness,thereby reducing theavailability of our cash flow to fund working capital,capital expenditures and for other general corporate purposes;limit our flexibility in planning for or reacting to changes in

317、our businesses and the industry in which we operate;place us at a competitive disadvantage compared with our competitors that have less debt;limit,along with the financial and other restrictive covenants of our indebtedness,among other things,our ability to borrow additional funds;and increase the c

318、ost of additional financing.In the future,we may from time to time incur substantial additional indebtedness and contingent liabilities.If we incur additional debt,the risks that weface as a result of our already substantial indebtedness and leverage could intensify.Our ability to generate sufficien

319、t cash to satisfy our outstanding and future debt obligations will depend upon our future operating performance,whichwill be affected by prevailing economic conditions and financial,business and other factors,many of which are beyond our control.We cannot assure youthat we will be able to generate s

320、ufficient cash flow from operations to support the repayment of our current indebtedness.If we are unable to service ourindebtedness,we will be forced to adopt an alternative strategy that may include actions such as reducing or delaying capital expenditures,selling assets,restructuring or refinanci

321、ng our indebtedness or seeking equity capital.These strategies may not be instituted on satisfactory terms,if at all.In addition,certain of our financing arrangements impose operating and financial restrictions on our business,which may negatively affect our ability to react to changesin market cond

322、itions,take advantage of business opportunities we believe to be desirable,obtain future financing,fund required capital expenditures,orwithstand a continuing or future downturn in our business.Any of these factors could materially and adversely affect our ability to satisfy our debtobligations.We m

323、ust comply with certain financial and other covenants under the terms of our debt instruments and the failure to do so may put us in default underthose instruments.Many of our loan agreements include financial covenants and broad default provisions.The financial covenants primarily include current r

324、atios,quickratios,debt to asset ratios,contingent liability ratios and minimum equity requirements,which,in general,govern our existing long-term debt and debt wemay incur in the future.These covenants could limit our ability to plan for or react to market conditions or to meet our capital needs in

325、a timely manner andcomplying with these covenants may require us to curtail some of our operations and growth plans.In addition,any global or regional economicdeterioration may cause us to incur significant net losses or force us to assume considerable liabilities,which would adversely impact our ab

326、ility to complywith the financial and other covenants of our outstanding loans.If our creditors refuse to grant waivers for any non-compliance with these covenants,suchnon-compliance will constitute an event of default which may accelerate the amounts due under the applicable loan agreements.Some of

327、 our loanagreements also contain cross-default clauses,which could enable creditors under our debt instruments to declare an event of default should there be an eventof default on our other loan agreements.We cannot assure you that we will be able to remain in compliance with these covenants in the

328、future.We may not beable to cure future24Table of Contentsviolations or obtain a waiver on a timely basis.An event of default under any agreement governing our existing or future debt,if not cured by us or waivedby our creditors,could have a material adverse effect on our liquidity,financial conditi

329、on and results of operations.Our dependence on Chinese banks to extend our existing loans and provide additional loans exposes us to funding risks,which may materially andadversely affect our operations.We require significant cash flow and funding to support our operations.As a result,we rely on sho

330、rt-term borrowings to provide working capital for ourdaily operations.Since the majority of our short-term borrowings come from Chinese banks,we are exposed to lending policy changes by the Chinese banks.In 2013,2014 and 2015,we successfully extended our short-term borrowings and,as of December 31,2

331、015,we had outstanding short-term borrowings of$828.0 million with Chinese banks.Between January 1,2016 and March 31,2016,we obtained new borrowings of approximately$362.0 million fromChinese banks,including$161.9 million with due dates beyond December 31,2016.Also,between January 1,2016 and March 3

332、1,2016,we renewedexisting bank facilities of approximately$146.4 million from Chinese banks with due dates beyond December 31,2016.If the Chinese government changes its macroeconomic policies and forces Chinese banks to tighten their lending practices,or if Chinese banks are nolonger willing to prov

333、ide financing to solar power companies,including us,we may not be able to extend our short-term borrowings or make additionalborrowings in the future.As a result,we may not be able to fund our operations to the same extent as in previous years,which may have a material andadverse effect on our operations.Cancellations of customer orders may make us unable to recoup any prepayments made to supplier