UPDATE 1-Timminco replaces silicon supply contract with Q-Cells

* New agreement to replace supply pact signed in 2008

* Timminco shares up 43 pct

May 25 (Reuters) - Canadian silicon processor Timminco Ltd (TIM.TO) said it reached an agreement with Germany's Q-Cells SE (QCEG.DE) for the supply of solar-grade silicon, replacing a contract signed in 2008 for the five-year period through 2013.

Timminco's shares were up 43 percent on the Toronto Stock Exchange.

The new agreement contemplates deliveries of 100 tonnes of solar-grade silicon for the remainder of 2009, Timminco, a unit of Dutch-based AMG Advanced Metallurgical Group NV (AMG.AS), said in a statement.

Timminco said it will also return the outstanding deposit of about 8.9 million euros to Q-Cells.

The companies agreed to a repayment schedule that will commence in the first quarter 2010 and be completed by the end of 2010.

Timminco will pay interest on the outstanding balance at an agreed rate.

Volumes, pricing and other terms for deliveries of solar-grade silicon in 2010 to 2013 will be subject to mutual agreement by the end of 2009, Timminco said.

Shares of Timminco were up 53 Canadian cents at C$1.76 in afternoon trade Monday on the Toronto Stock Exchange. (Reporting by Ashutosh Joshi in Bangalore; Editing by Vinu Pilakkott)