Exhibit 10.116
 
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED FROM PUBLIC FILING PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT SUBMITTED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION.
THE OMITTED INFORMATION, WHICH HAS BEEN IDENTIFIED WITH THE SYMBOL “[*],” HAS
BEEN FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
 
Amendment No. 3 to
Second Amended & Restated Supply Agreement
 
This Amendment No. 3 to Second Amended & Restated Supply Agreement (this
“Amendment”) is entered into as of the last date set forth on the signature page
hereto, by and between Hoku Materials, Inc., a Delaware corporation (“HOKU”),
and Solarfun Power Hong Kong Limited, a company registered in Hong Kong
(“SOLARFUN”).  HOKU and SOLARFUN are each a “Party” and together the “Parties”
to this Amendment.
 
Recitals
 
Whereas, HOKU and SOLARFUN are Parties to that certain Second Amended & Restated
Supply Agreement dated as of May 13, 2008, (the “Supply Agreement”) as amended
by that certain Amendment No. 1 to Second Amended & Restated Supply Agreement
dated as of October 22, 2008, and that certain Amendment No. 2 to Second Amended
& Restated Supply Agreement dated as of March 26, 2009 (collectively, the
“Agreement”);
 
Whereas, SOLARFUN has paid to HOKU $37 million of the $55 million Total Deposit;
 
Whereas, SOLARFUN was to have paid HOKU an additional $13 million of the Total
Deposit pursuant to the Agreement (the “Unpaid Deposit”) and such amount remains
unpaid as of the date hereof;
 
Whereas, the Parties desire to adjust the timing of when SOLARFUN will pay the
remaining $18 million of the Total Deposit to HOKU;
 
Whereas, the Parties desire to make certain amendments to the Agreement as
hereinafter set forth; and
 
Whereas, each Party derives a benefit from the amendments set forth herein.
 
Now therefore, in consideration of the foregoing, and for other good and
valuable consideration, the receipt of which is hereby acknowledged by the
Parties, the Parties agree to amend the Agreement as set forth below.
 
Agreement
 
1.           Effectiveness.  This Amendment shall become effective upon HOKU’s
receipt of Eight Million U.S. Dollars pursuant to Section 5.2.2 of the
Agreement, as amended by Section 4 below.  Solarfun will process the payment as
soon as possible.  If such payment is not received on or before that date which
falls fifteen (15) business days after the date of this Amendment, then this
Amendment shall be voidable at HOKU’s sole and absolute discretion.  In the
event that this Amendment is voided by HOKU, then the Agreement shall continue
in full force and effect.
 
2.           Definitions.  All capitalized terms not otherwise defined are
defined in the Agreement.
 
3.           Time & Location for Performance.  All dates and times set forth in
this Amendment shall be the day and time in New York, USA.

 

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4.           Amendment of Section 5.2.2.  Section 5.2.2 of the Agreement is
hereby amended and restated to read as follows:
 
5.2.2.     Seventeen Million U.S. Dollars (USD $17,000,000) of the Main Deposit
(the “Third Deposit”) shall be paid to HOKU in accordance with the following
payment schedule:

Payment Date
 
Payment Amount
(US Dollars)
 
March 31, 2009
  $ 5 million  
No later than fifteen (15)
business days after the date
of this Amendment
  $ 8 million  
March 1, 2010
  $ 4 million  

 
HOKU hereby acknowledges receipt of the $5 million payment that was due on or
before March 31, 2009.
 
5.           Amendment of Section 5.2.3.  Section 5.2.3 of the Agreement is
hereby amended and restated to read as follows:

5.2.3.     Six Million U.S. Dollars (USD $6,000,000.00) of the Main Deposit (the
“Fourth Deposit”) shall be paid to HOKU in equal monthly increments of One
Million Dollars (USD $1,000,000.00) beginning with the First Shipment Date, with
each such portion of the Fourth Deposit being invoiced separately on the date of
shipment, and being payable to HOKU within fifteen (15) calendar days after
receipt of the applicable invoice (the “Fourth Deposit Date”).
 
6.           Amendment of Section 5.4.  Section 5.4 of the Agreement is hereby
amended and restated to read as follows:
 
5.4.        HOKU shall invoice SOLARFUN at or after the time of each shipment of
Products to SOLARFUN. Taxes, customs and duties, if any, will be identified as
separate items on HOKU invoices. All invoices shall be sent to SOLARFUN’s
address as provided herein. Except for payment of any portion of the Fourth
Deposit, which shall be paid in accordance with Section 5.2.3 above, payment
terms for all invoiced amounts shall be [*] days from date of shipment. All
payments shall be made in U.S. Dollars.  Unless HOKU is entitled to retain the
Total Deposit as liquidated damages pursuant to Section 11 of the Agreement,
shipments to SOLARFUN shall be credited against the Total Deposit beginning in
the first Year, as set forth in Appendix 1 (Pricing Schedule).
 
7.           Amendment of Appendix 1.  Appendix 1 to the Agreement (Pricing
Schedule) is hereby amended and restated, and replaced with Appendix 1 to this
Amendment.
 
8.           Delay in Amortization.  In the event that HOKU is not able to make
shipments according to the schedule in Appendix 1 such that SOLARFUN’s
prepayments are similarly not amortized according to that schedule, then
SOLARFUN will not make any further prepayments (as those payments are detailed
in Sections 4 and 5 above) until the amortization of its previous prepayments is
in accordance with the schedule.  If HOKU’s shipments are delayed to such an
extent that the total amount of amortization due and outstanding to SOLARFUN
becomes US$1MM or more, then HOKU will directly refund that outstanding amount
to SOLARFUN from SOLARFUN’s previous prepayments in order to bring the
amortization in accordance with the schedule.

 

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9.           Waiver of Interest.  Provided that SOLARFUN makes all payments to
HOKU in accordance with the schedules set forth in Sections 4 and 5 above, HOKU
hereby agrees to waive all interest and penalties that may have accrued as a
result of SOLARFUN’s late payment of the Unpaid Deposit.
 
10.           HOKU’s Termination Rights.  In addition to HOKU’s rights and
remedies under the Agreement, and at law and in equity, in the event that
SOLARFUN fails to pay any amount of the Third Deposit or the Fourth Deposit by
the applicable date set forth in Section 5.2.2 of the Agreement, as amended by
Section 4 above, and Section 5.2.3 of the Agreement, as amended by Section 5
above (as applicable)  HOKU may, upon written notice to SOLARFUN in accordance
with the notice provisions set forth in Section 13 of the Supply Agreement, and
SOLARFUN’s right to cure such payment default within ten (10) days after receipt
of such notice, terminate the Agreement and retain all amounts of the Total
Deposit that have been paid to HOKU as of the date of such notice.
 
11.           Integration & Survival.  Except for the amendments specifically
set forth above, the terms of the Agreement shall continue in full force and
effect mutatis mutandis.  This Amendment and the Agreement constitute the entire
agreement between the Parties concerning the subject matter hereof.
 
12.           Miscellaneous.  Except where the terms of this Amendment conflict
with the Agreement, the “General Provisions” set forth in Section 13 of the
Agreement, including, without limitation, provisions concerning the choice of
law and means for dispute resolution between HOKU and SOLARFUN, shall apply to
this Amendment.  In the event of any conflict between the terms of this
Amendment and the Agreement, the terms of this Amendment shall control.

[Signature page follows.]

 

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IN WITNESS WHEREOF, the Parties have executed this Amendment No. 3 to Second
Amended & Restated Supply Agreement as of the first date set forth above.

 
SOLARFUN:
 
HOKU:
     
SOLARFUN POWER HONG KONG LIMITED
 
HOKU MATERIALS, INC.
     
By:
/s/ Ping Peter Xie
 
By:
/s/ Scott Paul
     
Name:
Ping Peter Xie
 
Name:
Scott Paul
     
Title:
Director
 
Title:
Chief Operating Officer
     
Date:
November 11, 2009
 
Date:
November 15, 2009

 
 

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Exhibit 10.116
 
Appendix 1
Pricing Schedule

 

   
Yr 1
 
Yr 2
 
Yr 3
 
Yr 4
 
Yr 5
 
Yr 6
 
Yr 7
 
Yr 8
 
Yr 9
   
Yr 10
   
Total
 
Tons per Year
    [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]      
[*]       [*]  
Price per KG
    [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]      
[*]          
Purchase Value ($M)
    [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]      
[*]       [*]  
Prepayment Credit/yr ($M)
    [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]      
[*]       [*]  
Net Invoice Amount /kg
    [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]     [*]      
[*]          

 
If there is uncertainty in price between the delivery period and the total
quantity for that period based on the table above, the price assigned to the
quantity shall prevail regardless of whether all of the shipments in each period
are delivered in that period.  For example, the first [*] MT shall be invoiced
at $[*] per kilogram even if some of that [*] MT is delivered in Year 2; the
next [*] MT shall be invoiced at $[*] per kilogram even if some of that [*] MT
is delivered in Year 3, and so forth

As per Section 4.1 of the Agreement, it is understood that a shipping schedule
will be provided by HOKU each year at least sixty (60) days prior to the
applicable year, except in the case of Year 1 above, where the shipping schedule
will be provided by HOKU at least 30 days prior to the date of the first
shipment.  It is further understood that the shipments for all Years, including
Year 1, will be approximately equal monthly shipments, and that the amortization
for each of those shipments will be on a pro-rated basis based on the annual
amortization amount in the table above.

 

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