17 Contingencies / Other Obligations

Contingencies are potential obligations based on past events of which the existence will not be confirmed until the occurrence of one or more uncertain future events which are beyond the Group’s influence. Present obligations, moreover, can likewise be contingencies if the likelihood of an outflow of resources is not strong enough to justify the recognition of a provision and/or the amount of the obligations cannot be estimated with sufficient reliability. The values assigned to contingencies correspond to the degree of liability that exists on the balance sheet date.

The contingencies and other obligations shown below are nominal values.

As of December 31, 2008, there were contingencies of €34.0 million relating to an obligation to make an additional contribution in connection with setting up our joint venture Siltronic Samsung Wafer Pte. Ltd. in Singapore.

Wacker Chemie AG has commited itself to support in the external financing of a joint venture by eventually issuing suretyships or other collateral amounting to €120 million.

There is a finance lease for the headquarters building in Munich which is used by the Group. The contract with the lessor expires in 2012. After that, WACKER’s pension fund or some company specified by it shall have the right to purchase the building at a price that has already been fixed.

Wacker Chemie AG has also capitalized a finance lease for the leased CCGT power station at its Burghausen site. The lease for the power station is due to expire in 2016 at the latest, although it can be terminated prematurely. In either case, WACKER has the right to acquire the power station at a price oriented to book values in accordance with German commercial law. If WACKER acquires this power station, it may not be sold to a third party for five years.

There are no conditional lease payments from finance leases.

Operating leases are used in particular for motor vehicles and IT equipment. These leases generally have terms of between three and five years. Tenancy agreements for office space, etc. have considerably longer terms.

Wacker Chemie AG has signed an agreement with joint-venture partners (Dow Corning, Samsung) to make investments in future years and provide necessary equity funds and/or loans. As of the balance sheet date, the Group expects further contractual contributions to equity amounting to some US$54 million. In addition, the Group is making a guarantee for borrowed funds amounting to some US$250 million. Of this total, guarantees for US$75.5 million have already been given. This is already included in the disclosure of guarantees/obligations to make additional contributions above.

The Group receives government subsidies for investment activities. These subsidies are tied to the condition that a certain number of jobs are created or maintained at certain times. If these contractual commitments are not fulfilled, any funding received must be paid back either in full or in part. The period for which the Group has to fulfill its contractual commitments is limited.

In order to safeguard the supply of the raw material ethylene at the Burghausen plant, Wacker Chemie AG has acquired a stake in EPS Ethylen-Pipeline-Süd GmbH & Co. KG, Munich. The capital contribution obligations that this acquisition involves amount to some €1 million and are likely to fall due in 2009.