EXHIBIT 10.3
 
Execution Version

THIRD PARTY PLEDGE AGREEMENT

1.           GRANT OF SECURITY INTEREST.  In consideration of any credit or
other financial accommodation heretofore, now or hereafter extended or made to
SUNPOWER CORPORATION, a Delaware corporation ("Borrower"), by WELLS FARGO BANK,
NATIONAL ASSOCIATION ("Bank") pursuant to the obligations of Borrower in
connection with the ”Line of Credit” under that certain Amended and Restated
Credit Agreement between Borrower and Bank and dated as of March 20, 2009 and as
amended on April 17, 2009 (as may be further amended from time to time, the
"Credit Agreement"), and for other valuable consideration, as security for the
payment of all such obligations of Borrower to Bank, the undersigned SUNPOWER
CORPORATION, SYSTEMS, a Delaware corporation ("Owner") hereby assigns, transfers
to and pledges with Bank, and grants to Bank a security interest in, the
following money and property:

60 registered shares of SunPower Systems SA, a Swiss limited company

(collectively called "Collateral"), together with whatever is receivable or
received when any of the Collateral or proceeds thereof are sold, collected,
exchanged or otherwise disposed of, whether such disposition is voluntary or
involuntary, including without limitation, (a) all rights to payment, including
returned premiums, with respect to any insurance relating to any of the
foregoing, (b) all rights to payment with respect to any claim or cause of
action affecting or relating to any of the foregoing, and (c) all stock rights,
rights to subscribe, stock splits, liquidating dividends, cash dividends,
dividends paid in stock, new securities or other property of any kind which
Owner is or may hereafter be entitled to receive on account of any securities
pledged hereunder, including without limitation, stock received by Owner due to
stock splits or dividends paid in stock or sums paid upon or in respect of any
securities pledged hereunder upon the liquidation or dissolution of the issuer
thereof (hereinafter called "Proceeds"), and in the event that Owner receives
any such Proceeds, Owner will hold the same in trust on behalf of and for the
benefit of Bank and will immediately deliver all such Proceeds to Bank in the
exact form received, with the endorsement of Owner if necessary and/or
appropriate undated stock powers duly executed in blank, to be held by Bank as
part of the Collateral, subject to all terms hereof.  The word "Indebtedness" is
used herein to mean any and all advances, debts, obligations and liabilities of
Borrower, heretofore, now or hereafter made, incurred or created, whether
voluntary or involuntary and however arising, whether due or not due, absolute
or contingent, liquidated or unliquidated, determined or undetermined, all in
connection with the Line of Credit.  Notwithstanding any provision to the
contrary herein, Bank shall only be entitled to retain $US50,000,000 in cash
proceeds of Collateral received by Bank in connection with the enforcement of
its rights hereunder.  Furthermore, Bank and Owner agree that at such time as
Bank exercises its rights to the Collateral hereunder, Bank's rights and
obligations will be exercised in accordance with that certain Right of First
Refusal Agreement dated of even date herewith between Bank and Owner.

2.           CONTINUING AGREEMENT; REVOCATION; OBLIGATION UNDER OTHER
AGREEMENTS.  This is a continuing agreement and all rights, powers and remedies
hereunder shall apply to all past, present and future Indebtedness of Borrower
to Bank, including that arising under successive transactions which shall either
continue the Indebtedness, increase or decrease it, or from time to time create
new Indebtedness after all or any prior Indebtedness has been satisfied, and
notwithstanding the death, incapacity, dissolution, liquidation or
 
 

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bankruptcy of Borrower or Owner or any other event or proceeding affecting
Borrower or Owner.  This Agreement shall not apply to any new Indebtedness
created after actual receipt by Bank of written notice of its revocation as to
such new Indebtedness; provided however, that loans or advances made by Bank to
Borrower after revocation under commitments existing prior to receipt by Bank of
such revocation, and extensions, renewals or modifications, of any kind, of
Indebtedness incurred by Borrower or committed by Bank prior to receipt by Bank
of such revocation, shall not be considered new Indebtedness.  Any such notice
must be sent to Bank by registered U.S. mail, postage prepaid, addressed to its
office at 400 Hamilton Avenue, Palo Alto, California 94301, or at such other
address as Bank shall from time to time designate.  The obligations of Owner
hereunder shall be in addition to any obligations of Owner under any other
grants or pledges of security for any liabilities or obligations of Borrower or
any other person heretofore or hereafter given to Bank unless said other grants
or pledges of security are expressly modified or revoked in writing; and this
Agreement shall not, unless expressly herein provided, affect or invalidate any
such other grants or pledges of security.

3.           OBLIGATIONS JOINT AND SEVERAL; SEPARATE ACTIONS; WAIVER OF STATUTE
OF LIMITATIONS; REINSTATEMENT OF LIABILITY.  The obligations hereunder are joint
and several and independent of the obligations of Borrower, and a separate
action or actions may be brought and prosecuted against Owner whether action is
brought against Borrower or any other person, or whether Borrower or any other
person is joined in any such action or actions.  Owner acknowledges that this
Agreement is absolute and unconditional, there are no conditions precedent to
the effectiveness of this Agreement, and this Agreement is in full force and
effect and is binding on Owner as of the date written below, regardless of
whether Bank obtains collateral or any guaranties from others or takes any other
action contemplated by Owner.  Owner waives the benefit of any statute of
limitations affecting Owner's liability hereunder or the enforcement thereof,
and Owner agrees that any payment of any Indebtedness or other act which shall
toll any statute of limitations applicable thereto shall similarly operate to
toll such statute of limitations applicable to Owner's liability hereunder.  The
liability of Owner hereunder shall be reinstated and revived and the rights of
Bank shall continue if and to the extent that for any reason any amount at any
time paid on account of any Indebtedness secured hereby is rescinded or must be
otherwise restored by Bank, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise, all as though such amount had not been
paid.  The determination as to whether any amount so paid must be rescinded or
restored shall be made by Bank in its sole discretion; provided however, that if
Bank chooses to contest any such matter at the request of Owner.  Owner agrees
to indemnify and hold Bank harmless from and against all costs and expenses,
including reasonable attorneys' fees (to include outside counsel fees), expended
or incurred by Bank in connection therewith, including without limitation, in
any litigation with respect thereto.

4.           OBLIGATIONS OF BANK:  Any money received by Bank in respect of the
Collateral may be deposited, at Bank's option, into a non-interest bearing
account over which Owner shall have no control, and the same shall, for all
purposes, be deemed Collateral hereunder.  Bank's obligation with respect to
Collateral and  Proceeds in its possession shall be strictly limited to the duty
to exercise reasonable care in the custody and preservation of such Collateral
and Proceeds, and such duty shall not include any obligation to ascertain or to
initiate any action with respect to or to inform Owner of maturity dates,
conversion, call or exchange rights, or offers to purchase the Collateral or
Proceeds, or any similar matters, notwithstanding Bank's knowledge of the
same.  Bank shall have no duty to take any steps necessary to preserve the
rights of Owner against prior parties, or to initiate any action to protect
against the possibility of a decline in the market value of the Collateral or
Proceeds.  Bank shall not be obligated to take any actions with respect to the
Collateral or Proceeds requested by Owner
 
 
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unless such request is made in writing and Bank determines, in its sole
discretion, that the requested action would not unreasonably jeopardize the
value of the Collateral and Proceeds as security for the Indebtedness.  Bank may
at any time deliver the Collateral and Proceeds, or any part thereof, to Owner,
and the receipt thereof by Owner shall be a complete and full acquittance for
the Collateral and Proceeds so delivered, and Bank shall thereafter be
discharged from any liability or responsibility therefor.

5.           REPRESENTATIONS AND WARRANTIES.

(a)           Owner represents and warrants to Bank that:  (i) Owner's legal
name is exactly as set forth on the first page of this Agreement, and all of
Owner's organizational documents or agreements delivered to Bank are complete
and accurate in every respect; (ii) Owner is the owner and has possession or
control of the Collateral and Proceeds; (iii) Owner has the exclusive right to
pledge the Collateral and Proceeds; (iv) all Collateral and Proceeds are
genuine, free from liens, adverse claims, setoffs, default, prepayment, defenses
and conditions precedent of any kind or character, except the lien created
hereby or as otherwise agreed to by Bank, or heretofore disclosed by Owner to
Bank, in writing;  (v) all statements contained herein and, where applicable, in
the Collateral are true and complete in all material respects; (vi) no financing
statement covering any of the Collateral or Proceeds, and naming any secured
party other than Bank, is on file in any public office; and (vii) specifically
with respect to Collateral and Proceeds consisting of investment securities,
instruments, chattel paper, documents, contracts, insurance policies or any like
property, all persons appearing to be obligated thereon have authority and
capacity to contract and are bound as they appear to be, and the same comply
with applicable laws concerning form, content and manner of preparation and
execution.

(b)           Owner further represents and warrants to Bank that:  (i) the
Collateral pledged hereunder is so pledged at Borrower' request; (ii) Bank has
made no representation to Owner as to the creditworthiness of Borrower; and
(iii) Owner has established adequate means of obtaining from Borrower on a
continuing basis financial and other information pertaining to Borrower's
financial condition.  Owner agrees to keep adequately informed from such means
of any facts, events or circumstances which might in any way affect Owner's
risks hereunder, and Owner further agrees that Bank shall have no obligation to
disclose to Owner any information or material about Borrower which is acquired
by Bank in any manner.

6.           COVENANTS OF OWNER.

(a)           Owner agrees in general: (i) to indemnify Bank against all losses,
claims, demands, liabilities and expenses of every kind caused by property
subject hereto; (ii) to permit Bank to exercise its powers; (iii) to execute and
deliver such documents as Bank deems necessary to create, perfect and continue
the security interests contemplated hereby; (iv) not to change Owner's name, and
as applicable, its chief executive office, its principal residence or the
jurisdiction in which it is organized and/or registered without giving Bank
prior written notice thereof; (v) not to change the places where Owner keeps any
Collateral or Owner's records concerning the Collateral and Proceeds without
giving Bank prior written notice of the address to which Owner is moving same;
and (vi) to cooperate with Bank in perfecting all security interests granted
herein and in obtaining such agreements from third parties as Bank deems
necessary, proper or convenient in connection with the preservation, perfection
or enforcement of any of its rights hereunder.

(b)           Owner agrees with regard to the Collateral and Proceeds, unless
Bank agrees otherwise in writing:  (i) that Bank is authorized to file financing
statements in the name of
 
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Owner to perfect Bank's security interest in Collateral and Proceeds; (ii) not
to permit any lien on the Collateral or Proceeds, except in favor of Bank;
(iii)  not to sell, hypothecate or otherwise dispose of, nor permit the transfer
by operation of law of, any of the Collateral or Proceeds or any interest
therein, nor withdraw any funds from any deposit account pledged to Bank
hereunder; (iv)  to keep, in accordance with generally accepted accounting
principles, complete and accurate records regarding all Collateral and Proceeds,
and to permit Bank to inspect the same and make copies thereof at any reasonable
time; (v) if requested by Bank, to receive and use reasonable diligence to
collect Proceeds, in trust and as the property of Bank, and to immediately
endorse as appropriate and deliver such Proceeds to Bank daily in the exact form
in which they are received together with a collection report in form
satisfactory to Bank; (vi) in the event Bank elects to receive payments of
Proceeds hereunder, to pay all expenses incurred by Bank in connection
therewith, including expenses of accounting, correspondence, collection efforts,
reporting to account or contract debtors, filing, recording, record keeping and
expenses incidental thereto; (vii) to provide any service and do any other acts
which may be necessary to keep all Collateral and Proceeds free and clear of all
defenses, rights of offset and counterclaims; and (viii) if the Collateral or
Proceeds consists of securities and so long as no Event of Default exists, to
vote said securities and to give consents, waivers and ratifications with
respect thereto, provided that no vote shall be cast or consent, waiver or
ratification given or action taken which would impair Bank's interest in the
Collateral and Proceeds or be inconsistent with or violate any provisions of
this Agreement.

7.           POWERS OF BANK.  Owner appoints Bank its true attorney in fact to
perform any of the following powers, which are coupled with an interest, are
irrevocable until termination of this Agreement and may be exercised from time
to time by Bank's officers and employees, or any of them, whether or not
Borrower or Owner is in default:  (a) to perform any obligation of Owner
hereunder in Owner's name or otherwise; (b) to notify any person obligated on
any security, instrument or other document subject to this Agreement of Bank's
rights hereunder; (c) to collect by legal proceedings or otherwise all
dividends, interest, principal or other sums now or hereafter payable upon or on
account of the Collateral or Proceeds; (d) to enter into any extension,
modification, reorganization, deposit, merger or consolidation agreement, or any
other agreement relating to or affecting the Collateral or Proceeds, and in
connection therewith to deposit or surrender control of the Collateral and
Proceeds, to accept other property in exchange for the Collateral and Proceeds,
and to do and perform such acts and things as Bank may reasonably deem proper,
with any money or property received in exchange for the Collateral or Proceeds,
at Bank's option, to be applied to the Indebtedness or held by Bank under this
Agreement; (e) to make any compromise or settlement Bank reasonably deems
desirable or proper in respect of the Collateral and Proceeds; (f) to insure,
process and preserve the Collateral and Proceeds; (g) to exercise all rights,
powers and remedies which Owner would have, but for this Agreement, with respect
to all Collateral and Proceeds subject hereto; and (h) to do all acts and things
and execute all documents in the name of Owner or otherwise, reasonably deemed
by Bank as necessary in connection with the preservation, perfection or
enforcement of its rights hereunder.  To effect the purposes of this Agreement
or otherwise upon instructions of Owner, Bank may cause any Collateral and/or
Proceeds to be transferred to Bank's name or the name of Bank's nominee.  If an
Event of Default has occurred and is continuing, any or all Collateral and/or
Proceeds consisting of securities may be registered, without notice, in the name
of Bank or its nominee, and thereafter Bank or its nominee may exercise, without
notice, all voting and corporate rights at any meeting of the shareholders of
the issuer thereof, any and all rights of conversion, exchange or subscription,
or any other rights, privileges or options pertaining to such Collateral and/or
Proceeds, all as if it were the absolute owner thereof.  The foregoing shall
include, without limitation, the right of Bank or its nominee to exchange, at
its discretion, any and all Collateral and/or Proceeds upon the merger,
 
 
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consolidation, reorganization, recapitalization or other readjustment of the
issuer thereof, or upon the exercise by the issuer thereof or Bank of any right,
privilege or option pertaining to any shares of the Collateral and/or Proceeds,
and in connection therewith, the right to deposit and deliver any and all of the
Collateral and/or Proceeds with any committee, depository, transfer agent,
registrar or other designated agent upon such terms and conditions as Bank may
determine.  All of the foregoing rights, privileges or options may be exercised
without liability on the part of Bank or its nominee except to account for
property actually received by Bank.  Bank shall have no duty to exercise any of
the foregoing, or any other rights, privileges or options with respect to the
Collateral or Proceeds and shall not be responsible for any failure to do so or
delay in so doing.

8.           OWNER'S WAIVERS.

(a)           Owner waives any right to require Bank to:  (i) proceed against
Borrower or any other person; (ii) marshal assets or proceed against or exhaust
any security held from Borrower or any other person; (iii) give notice of the
terms, time and place of any public or private sale or other disposition of
personal property security held from Borrower or any other person; (iv) take any
other action or pursue any other remedy in Bank's power; or (v) make any
presentment or demand for performance, or give any notice of nonperformance,
protest, notice of protest or notice of dishonor hereunder or in connection with
any obligations or evidences of indebtedness held by Bank as security for or
which constitute in whole or in part the Indebtedness secured hereunder, or in
connection with the creation of new or additional Indebtedness.

(b)           Owner waives any defense to its obligations hereunder based upon
or arising by reason of:  (i) any disability or other defense of Borrower or any
other person; (ii) the cessation or limitation from any cause whatsoever, other
than payment in full, of the Indebtedness of Borrower or any other person;
(iii) any lack of authority of any officer, director, partner, agent or any
other person acting or purporting to act on behalf of Borrower which is a
corporation, partnership or other type of entity, or any defect in the formation
of any such Borrower; (iv) the application by Borrower of the proceeds of any
Indebtedness for purposes other than the purposes represented by Borrower to, or
intended or understood by, Bank or Owner; (v) any act or omission by Bank which
directly or indirectly results in or aids the discharge of Borrower or any
portion of the Indebtedness by operation of law or otherwise, or which in any
way impairs or suspends any rights or remedies of Bank against Borrower; (vi)
any impairment of the value of any interest in the Collateral or Proceeds, or
any other security for the Indebtedness or any portion thereof, including
without limitation, the failure to obtain or maintain perfection or recordation
of any interest in any such security, the release of any such security without
substitution, and/or the failure to preserve the value of, or to comply with
applicable law in disposing of, any such security; (vii) any modification of the
Indebtedness, in any form whatsoever, including any modification made after
revocation hereof to any Indebtedness incurred prior to such revocation, and
including without limitation the renewal, extension, acceleration or other
change in time for payment of, or other change in the terms of, the Indebtedness
or any portion thereof, including increase or decrease of the rate of interest
thereon; or (viii) any requirement that Bank give any notice of acceptance of
this Agreement.  Until all Indebtedness shall have been paid in full, Owner
shall have no right of subrogation, and Owner waives any right to enforce any
remedy which Bank now has or may hereafter have against Borrower or any other
person, and waives any benefit of, or any right to participate in, any security
now or hereafter held by Bank.  Owner further waives all rights and defenses
Owner may have arising out of (A) any election of remedies by Bank, even though
that election of remedies, such as a non-judicial foreclosure with respect to
any security for any portion of the Indebtedness, destroys Owner's rights of
subrogation or Owner's rights to proceed against
 
 
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Borrower for reimbursement, or (B) any loss of rights Owner may suffer by reason
of any rights, powers or remedies of Borrower in connection with any
anti-deficiency laws or any other laws limiting, qualifying or discharging
Borrower's Indebtedness.

9.           AUTHORIZATIONS TO BANK.  Owner authorizes Bank either before or
after revocation hereof, without notice to or demand on Owner, and without
affecting Owner's liability hereunder, from time to time to: (a) alter,
compromise, renew, extend, accelerate or otherwise change the time for payment
of, or otherwise change the terms of, the Indebtedness or any portion thereof,
including increase or decrease of the rate of interest thereon; (b) take and
hold security, other than the Collateral and Proceeds, for the payment of the
Indebtedness or any portion thereof, and exchange, enforce, waive, subordinate
or release the Collateral and Proceeds, or any part thereof, or any such other
security; (c) apply the Collateral and Proceeds or such other security and
direct the order or manner of sale thereof, including without limitation, a
non-judicial sale permitted by the terms of the controlling security agreement,
mortgage or deed of trust, as Bank in its discretion may determine; (d) release
or substitute any one or more of the endorsers or guarantors of the
Indebtedness, or any portion thereof, or any other party thereto; and (e) apply
payments received by Bank from Borrower to any Indebtedness of Borrower to Bank,
in such order as Bank shall determine in its sole discretion, whether or not
such Indebtedness is covered by this Agreement, and Owner hereby waives any
provision of law regarding application of payments which specifies
otherwise.  Bank may without notice assign this Agreement in whole or in part.

10.           PAYMENT OF PREMIUMS, TAXES, CHARGES, LIENS AND ASSESSMENTS.  Owner
agrees to pay, prior to delinquency, all insurance premiums, taxes, charges,
liens and assessments against the Collateral and Proceeds, and upon the failure
of Owner to do so, Bank at its option may pay any of them and shall be the sole
judge of the legality or validity thereof and the amount necessary to discharge
the same.  Any such payments made by Bank shall be obligations of Owner to Bank,
due and payable promptly upon demand, together with interest at a rate
determined in accordance with the provisions of this Agreement, and shall be
secured by the Collateral and Proceeds, subject to all terms and conditions of
this Agreement.

11.           EVENTS OF DEFAULT.  The occurrence of any of the following shall
constitute an "Event of Default" under this Agreement:  (a) any default in the
payment or performance of any obligation, or any defined event of default, under
(i) the Credit Agreement; (b) any representation or warranty made by Owner
herein shall prove to be incorrect in any material respect when made; (c) Owner
shall fail to observe or perform any obligation or agreement contained herein;
and (d) any impairment of the rights of Bank in any Collateral or Proceeds, or
any attachment or like levy on any property of Owner.

12.           REMEDIES.  Upon the occurrence of any Event of Default, Bank shall
have and may exercise without demand any and all rights, powers, privileges and
remedies granted to a secured party upon default under the California Uniform
Commercial Code, the laws of Switzerland or otherwise provided by law, including
without limitation, the right (a) to contact all persons obligated to Owner on
any Collateral or Proceeds and to instruct such persons to deliver all
Collateral and/or Proceeds directly to Bank, and (b) to sell, lease, license or
otherwise dispose of any or all Collateral.  All rights, powers, privileges and
remedies of Bank shall be cumulative.  No delay, failure or discontinuance of
Bank in exercising any right, power, privilege or remedy hereunder shall affect
or operate as a waiver of such right, power, privilege or remedy; nor shall any
single or partial exercise of any such right, power, privilege or remedy
preclude, waive or otherwise affect any other or further exercise thereof or the
exercise of any other right, power, privilege or remedy.  Any waiver, permit,
consent or approval of any kind by
 
 
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Bank of any default hereunder, or any such waiver of any provisions or
conditions hereof, must be in writing and shall be effective only to the extent
set forth in writing.  It is agreed that public or private sales or other
dispositions, for cash or on credit, to a wholesaler or retailer or investor, or
user of property of the types subject to this Agreement, or public auctions, are
all commercially reasonable since differences in the prices generally realized
in the different kinds of dispositions are ordinarily offset by the differences
in the costs and credit risks of such dispositions.  While an Event of Default
exists: (a) Owner will not dispose of any of the Collateral or Proceeds except
on terms approved by Bank; (b) Bank may appropriate the Collateral and apply all
Proceeds toward repayment of the Indebtedness in such order as Bank may from
time to time elect; (c) Bank may, at any time and at Bank's sole option,
liquidate any time deposits pledged to Bank hereunder, whether or not said time
deposits have matured and notwithstanding the fact that such liquidation may
give rise to penalties for early withdrawal of funds; and (d) at Bank's request,
Owner will assemble and deliver all Collateral and Proceeds, and books and
records pertaining thereto, to Bank at a reasonably convenient place designated
by Bank.  For any Collateral or Proceeds consisting of securities, Bank shall be
under no obligation to delay a disposition of any portion thereof for the period
of time necessary to permit the issuer thereof to register such securities for
public sale under any applicable state or federal law, even if the issuer
thereof would agree to do so.  Owner further agrees that Bank shall have no
obligation to process or prepare any Collateral for sale or other disposition.

13.           DISPOSITION OF COLLATERAL AND PROCEEDS; TRANSFER OF
INDEBTEDNESS.  In disposing of Collateral hereunder, Bank may disclaim all
warranties of title, possession, quiet enjoyment and the like.  Any proceeds of
any disposition of any Collateral or Proceeds, or any part thereof, may be
applied by Bank to the payment of expenses incurred by Bank in connection with
the foregoing, including reasonable attorneys' fees, and the balance of such
proceeds may be applied by Bank toward the payment of the Indebtedness in such
order of application as Bank may from time to time elect.  Upon the transfer of
all or any part of the Indebtedness, Bank may transfer all or any part of the
Collateral or Proceeds and shall be fully discharged thereafter from all
liability and responsibility with respect to any of the foregoing so
transferred, and the transferee shall be vested with all rights and powers of
Bank hereunder with respect to any of the foregoing so transferred; but with
respect to any Collateral or Proceeds not so transferred, Bank shall retain all
rights, powers, privileges and remedies herein given.

14.           NOTICES.  All notices, requests and demands required under this
Agreement must be in writing, addressed to Bank at the address specified in
Section 2 hereof and to Owner at the address of its chief executive office (or
principal residence, if applicable) specified below or to such other address as
any party may designate by written notice to each other party, and shall be
deemed to have been given or made as follows:  (a) if personally delivered, upon
delivery; (b) if sent by mail, upon the earlier of the date of receipt or three
(3) days after deposit in the U.S. mail, first class and postage prepaid; and
(c) if sent by telecopy, upon receipt.

15.           COSTS, EXPENSES AND ATTORNEYS' FEES.  Owner shall pay to Bank
promptly upon demand the full amount of all payments, advances, charges, costs
and expenses, including reasonable attorneys' fees, reasonably expended or
incurred by Bank in connection with (a) the perfection and preservation of the
Collateral or Bank's interest therein, and (b) the realization, enforcement and
exercise of any right, power, privilege or remedy conferred by this Agreement,
whether incurred at the trial or appellate level, in an arbitration proceeding
or otherwise, and including any of the foregoing incurred in connection with any
bankruptcy proceeding (including without limitation, any adversary proceeding,
contested matter or motion brought by Bank or any other person) relating to
Owner or in any way affecting any of
 
 
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the Collateral or Bank's ability to exercise any of its rights or remedies with
respect thereto.  All of the foregoing shall be paid by Owner with interest from
the date of demand until paid in full at a rate per annum equal to the greater
of ten percent (10%) or Bank’s Prime Rate in effect from time to time.

16.           SUCCESSORS; ASSIGNMENT.  This Agreement shall be binding upon and
inure to the benefit of the heirs, executors, administrators, legal
representatives, successors and assigns of the parties; provided however, that
Owner may not assign or transfer any of its interests or rights hereunder
without Bank's prior written consent.  Owner acknowledges that Bank has the
right to sell, assign, transfer, negotiate or grant participations in all or any
part of, or any interest in, any Indebtedness of Borrower to Bank and any
obligations with respect thereto, including this Agreement.  In connection
therewith, Bank may disclose all documents and information which Bank now has or
hereafter acquires relating to Owner and/or this Agreement, whether furnished by
Borrower, Owner or otherwise, subject to the confidentiality provisions of the
Confidentiality Agreement between SunPower Corporation and Bank, dated as of
June 19, 2007.  Owner further agrees that Bank may disclose such documents and
information to Borrower.

17.           AMENDMENT.  This Agreement may be amended or modified only in
writing signed by Bank and Owner.

18.           APPLICATION OF SINGULAR AND PLURAL.  In all cases where there is
but a single Borrower, then all words used herein in the plural shall be deemed
to have been used in the singular where the context and construction so require;
and when there is more than one Borrower named herein or when this Agreement is
executed by more than one Owner, the word "Borrower" and the word "Owner"
respectively shall mean all or any one or more of them as the context requires.

19.           SEVERABILITY OF PROVISIONS.  If any provision of this Agreement
shall be held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or any
remaining provisions of this Agreement.

20.           GOVERNING LAW.  This Agreement shall be governed by and construed
in accordance with the laws of the State of California.

21.           ARBITRATION.

(a)           Arbitration.  The parties hereto agree, upon demand by any party,
to submit to binding arbitration all claims, disputes and controversies between
or among them (and their respective employees, officers, directors, attorneys,
and other agents), whether in tort, contract or otherwise in any way arising out
of or relating to this Agreement and its negotiation, execution,
collateralization, administration, repayment, modification, extension,
substitution, formation, inducement, enforcement, default or termination.

(b)           Governing Rules.  Any arbitration proceeding will (i) proceed in a
location in California selected by the American Arbitration Association (“AAA”);
(ii) be governed by the Federal Arbitration Act (Title 9 of the United States
Code), notwithstanding any conflicting choice of law provision in any of the
documents between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA’s commercial dispute resolution procedures, unless the claim or counterclaim
is at
 
 
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least $US1,000,000.00 exclusive of claimed interest, arbitration fees and costs
in which case the arbitration shall be conducted in accordance with the AAA’s
optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to herein, as applicable, as the
“Rules”).  If there is any inconsistency between the terms hereof and the Rules,
the terms and procedures set forth herein shall control.  Any party who fails or
refuses to submit to arbitration following a demand by any other party shall
bear all costs and expenses incurred by such other party in compelling
arbitration of any dispute.  Nothing contained herein shall be deemed to be a
waiver by any party that is a bank of the protections afforded to it under 12
U.S.C. §91 or any similar applicable state law.

(c)           No Waiver of Provisional Remedies, Self-Help and Foreclosure.  The
arbitration requirement does not limit the right of any party to (i) foreclose
against real or personal property collateral; (ii) exercise self-help remedies
relating to collateral or proceeds of collateral such as setoff or repossession;
or (iii) obtain provisional or ancillary remedies such as replevin, injunctive
relief, attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding.  This exclusion does not constitute a
waiver of the right or obligation of any party to submit any dispute to
arbitration or reference hereunder, including those arising from the exercise of
the actions detailed in sections (i), (ii) and (iii) of this paragraph.

(d)           Arbitrator Qualifications and Powers.  Any arbitration proceeding
in which the amount in controversy is $US5,000,000.00 or less will be decided by
a single arbitrator selected according to the Rules, and who shall not render an
award of greater than $US5,000,000.00.  Any dispute in which the amount in
controversy exceeds $US5,000,000.00 shall be decided by majority vote of a panel
of three arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations.  The arbitrator will be a neutral
attorney licensed in the State of California or a neutral retired judge of the
state or federal judiciary of California, in either case with a minimum of ten
years experience in the substantive law applicable to the subject matter of the
dispute to be arbitrated.  The arbitrator will determine whether or not an issue
is arbitratable and will give effect to the statutes of limitation in
determining any claim.  In any arbitration proceeding the arbitrator will decide
(by documents only or with a hearing at the arbitrator's discretion) any
pre-hearing motions which are similar to motions to dismiss for failure to state
a claim or motions for summary adjudication.  The arbitrator shall resolve all
disputes in accordance with the substantive law of California and may grant any
remedy or relief that a court of such state could order or grant within the
scope hereof and such ancillary relief as is necessary to make effective any
award.  The arbitrator shall also have the power to award recovery of all costs
and fees, to impose sanctions and to take such other action as the arbitrator
deems necessary to the same extent a judge could pursuant to the Federal Rules
of Civil Procedure, the California Rules of Civil Procedure or other applicable
law.  Judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction.  The institution and maintenance of an action for
judicial relief or pursuit of a provisional or ancillary remedy shall not
constitute a waiver of the right of any party, including the plaintiff, to
submit the controversy or claim to arbitration if any other party contests such
action for judicial relief.

(e)           Discovery.  In any arbitration proceeding, discovery will be
permitted in accordance with the Rules.  All discovery shall be expressly
limited to matters directly relevant to the dispute being arbitrated and must be
completed no later than 20 days before the hearing date.  Any requests for an
extension of the discovery periods, or any discovery disputes, will be subject
to final determination by the arbitrator upon a showing that the request for
discovery is
 
 
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essential for the party's presentation and that no alternative means for
obtaining information is available.

(f)           Class Proceedings and Consolidations.  No party hereto shall be
entitled to join or consolidate disputes by or against others in any
arbitration, except parties who have executed this Agreement or any other
contract, instrument or document relating to any Indebtedness, or to include in
any arbitration any dispute as a representative or member of a class, or to act
in any arbitration in the interest of the general public or in a private
attorney general capacity.

(g)           Payment Of Arbitration Costs And Fees.  The arbitrator shall award
all costs and expenses of the arbitration proceeding.

(h)           Miscellaneous.  To the maximum extent practicable, the AAA, the
arbitrators and the parties shall take all action required to conclude any
arbitration proceeding within 180 days of the filing of the dispute with the
AAA.  No arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by
a party required in the ordinary course of its business or by applicable law or
regulation.  If more than one agreement for arbitration by or between the
parties potentially applies to a dispute, the arbitration provision most
directly related to the documents between the parties or the subject matter of
the dispute shall control.  This arbitration provision shall survive
termination, amendment or expiration of any of the documents or any relationship
between the parties.

(i)           Small Claims Court.  Notwithstanding anything herein to the
contrary, each party retains the right to pursue in Small Claims Court any
dispute within that court’s jurisdiction.  Further, this arbitration provision
shall apply only to disputes in which either party seeks to recover an amount of
money (excluding attorneys’ fees and costs) that exceeds the jurisdictional
limit of the Small Claims Court.

Owner warrants that Owner is an organization registered under the laws of
Delaware.

Owner warrants that its chief executive office (or principal residence, if
applicable) is located at the following address: 3939 N. First Street, San Jose,
CA 95134.

IN WITNESS WHEREOF, this Agreement has been duly executed as of May 20, 2009.

OWNER:

SUNPOWER CORPORATION, SYSTEMS

By: /s/ Dennis V. Arriola                                                      
Dennis V. Arriola
Title:          CFO