Exhibit 10.1

March 29, 2006

VIA EMAIL & CERTIFIED MAIL

Central Pacific Bank, a Hawaii corporation

P.O. Box 3590

Honolulu, Hawaii 96811-3590

 

Attn:    Robert Kamemoto    Senior Vice President, Commercial Underwriting

Dear Mr. Kamemoto:

Pursuant to the Loan Agreement dated June 9, 2005, by and between Hoku
Scientific, Inc., a Delaware corporation (the “Borrower”), and Central Pacific
Bank, a Hawaii corporation (the “Lender”) for the principal amount of $3,500,000
(the “Loan Agreement”), and the various Loan Documents (as defined in the Loan
Agreement), Borrower is hereby giving notice to Lender of Borrower’s intent to
terminate the Loan Agreement and the Loan Documents.

To date, Borrower has not received any loan amount from Lender; and, therefore
no principal or any unpaid interest is outstanding under the Loan Documents. In
addition, there has been no occurrence of any Event of Default (as defined in
the Loan Agreement). To date, Borrower has made the following payments to
Lender:

 

Description

   Amount  

Equity Contribution

   $ 100,000.00  

CPB Legal Fees to KDUB&M

     3,567.42  

CPB Inspection Fee

     500.00  

Return of contribution (8/12/05)

     (100,000.00 )         

TOTAL

   $ 4,067.42           

This letter serves as written notice of Borrower’s intent to terminate the Loan
Agreement and the Loan Documents; and Borrower’s request for the release of the
Collateral (as defined in the Security Agreement dated June 9, 2005 by and
between Lender and Borrower, the “Security Agreement”) from the security
interest created in the Security Agreement.

Please sign below to acknowledge the Lender’s agreement that the Loan Agreement
is terminated and that the Collateral is released from the security interest
created in the Security Agreement. Thank you for your time and attention to this
matter.

Sincerely yours,

 

/s/ Darryl Nakamoto

Darryl Nakamoto Chief Financial Officer

Acknowledged & agreed on March 29, 2006

 

CENTRAL PACIFIC BANK By:  

/s/ Robert Kamemoto

Name:   Robert Kamemoto Title:   Senior Vice President