EXHIBIT
10.98

     

    [*] =
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.

    


    HOKU CHANGE ORDER
3.0

    


    


    February
19, 2009

    


    STONE
& WEBSTER, INC.

    Attn:  Mel
Barnett

    One Main
Street

    Cambridge,
MA 02142

    


    Dear
Mel:

    


    Pursuant
to Article 8.2 of the Engineering, Procurement & Construction Management
Agreement (the “Agreement”) dated
August 7, 2007, by and between Hoku Materials, Inc. (“Owner”) and Stone
& Webster, Inc. (“Contractor”), Owner
and Contractor hereby agree to the following Change Order (as defined in the
Agreement).  Capitalized terms not otherwise defined in this Change
Order are defined in the Agreement.

    


    
      	
               
      

            	
              1.

            	
              The
      title of the Agreement is hereby changed from “ENGINEERING, PROCUREMENT
      & CONSTRUCTION MANAGEMENT AGREEMENT” to “ENGINEERING AND PROCUREMENT
      AGREEMENT”.  Also, in line 1 of the Agreement, replace
      “Engineering, Procurement and Construction Management” with “Engineering
      and Procurement”.

            


    

    


    
      	
               
      

            	
              2.

            	
              Section
      1.1 AGREEMENT. In line 1 and 2, replace “Engineering, Procurement and
      Construction Management” with “Engineering and
    Procurement.”

            


    

     

    
      	
               
      

            	
              3.

            	
              Section
      1.6 of the Agreement, which defines “CONSTRUCTION MANAGEMENT” is hereby
      deleted in its entirety and replaced with the
  following:

            


    

     

     

    
      	
               
      

            	
              3.6

            	
              CONSTRUCTION
      MANAGEMENT.  Construction Management shall mean services related
      to coordinating, monitoring, status assessment and reporting on
      construction progress, schedule, and budget, which services will be
      provided by Owner or Owner’s designated
  representative.

            


    

     

     

    
      	
               
      

            	
              4.

            	
              Section
      1.10 OWNER AND CONTRACTOR.  In line 2, of Section 1.10, delete
      the phrase “and its Construction Management
  Services.”

            


    

     

     

     

    
      One Hoku
Way · Pocatello, Idaho 83204 · Tel 808-682-7800 · Fax 808-440-0357 ·
www.hokumaterials.com

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
    

     

    
      	 	
              Mr. Mel
      Barnett

              Stone & Webster,
      Inc.

              February 19, 2009

              Page 2 of 13

               

            


    

     

     

    
      	
               
      

            	
              5.

            	
              Section
      1.16 of the Agreement, which defines “Substantial Completion” is hereby
      deleted in its entirety and replaced with the
  following:

            


    

     

    1.16.
SUBSTANTIAL COMPLETION.  Substantial Completion shall be by Milestone
as specified in Exhibit B (Contract Time Schedule).  Actual
Substantial Completion for an applicable Milestone shall be deemed achieved at
the time when  the plans, drawings, designs, and other deliverables
that are required for commencing construction of the portion of the Project
associated with a corresponding Milestone and which are included in Contractor’s
Engineering Services, have been issued for construction (“IFC”) to Owner or
Owner’s designated construction contractor.  Substantial Completion of
a

     

    Milestone
shall not be withheld or deemed unachieved by reason of minor immaterial
items/portions of incomplete Work, which items/portions of Work are not
necessary for commencement of construction in an orderly and efficient
manner.  The terms “substantially complete” and “substantially
completed” as applied to all or part of the Project or Milestone refer to
Substantial Completion thereof.

     

    
      	
               
      

            	
              6.

            	
              Section
      1.9 of the Agreement, which defines “Milestone” is hereby deleted in its
      entirety and replaced with the
following:

            


    

     

    1.9
MILESTONE.  The term Milestone shall mean the “Final IFC Date” listed
by design discipline for each major Project system listed in Exhibit
B.

     

    
      	
               
      

            	
              7.

            	
              Section
      1.20 of  the Agreement, which defines “Work” is hereby deleted
      in its entirety and replaced with the
following:

            


    

     

    
      	
               
      

            	
              1.20

            	
              WORK.  The
      term “Work” shall mean Engineering Services and procurement services of
      the Project to be performed by Contractor under this Agreement and
      includes all services, labor, and tests provided or to be provided to
      fulfill Contractor’s obligations under this Agreement, as described on
      Exhibit A attached hereto.

            


    

     

    
      	
               
      

            	
              8.

            	
              Section
      2.11. AGREEMENT.  In line 1 of Section 2.11, replace
      “Engineering, Procurement and Construction Management” with “Engineering
      and Procurement.”

            


    

    


    
      	
               
      

            	
              9.

            	
              Section
      3.1.9. SAFETY.  Starting in line 3 of Section 3.1.9 delete,
      “Contractor shall implement a Site safety program based . . . to Owner
      upon request.”  Also, in line 12, delete, “and to comply with
      all . . . hazards at the job site.”

            


    

     

    
      	
               
      

            	
              10.

            	
              Insofar
      as Contractor is no longer responsible for construction management within
      its scope of Work, Section 3.4 (inclusive of Sections 3.4.1 – 3.4.3) are
      hereby deleted in their entirety and replaced with the
      following:

            


    

     

     

    3.4           [RESERVED]

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 3 of 13

                 

              


      

       

    

     

    3.4.1           [RESERVED]

     

    3.4.2           [RESERVED]

     

    3.4.3           [RESERVED]

     

    
      	
               
      

            	
              11.

            	
              Insofar
      as Contractor is not responsible for commissioning or start-up of
      equipment within its scope of Work, but is only responsible for providing
      the Engineering Services, Section 6.2 of the Agreement is hereby deleted
      in its entirety and replaced with the
following:

            


    

     

    6.2           [RESERVED]

     

    
      	
               
      

            	
              12.

            	
              Section
      6.3 of the Agreement, which relates to delays to the Contract Time
      Schedule is hereby deleted in its entirety and replaced with the
      following:

            


    

     

      6.3.           DELAYS.  If
Contractor is unable to meet any Milestone on the Contract Time Schedule due to
any actual delay in the progress of the Work that is caused by: (1) any act or
omission of Owner or by any separate contractor employed by Owner, (2) changes
ordered in the Project; (3) any act of force majeure including, but not limited
to, strikes, fire, acts of God, or any event beyond the control of Contractor;
or (4) by a delay authorized by Owner, then Contractor shall be entitled to a
Change Order extending the applicable Milestone date and Target Price for the
period of time and for such increase in the Target Price as are directly caused
by any of the foregoing circumstances of such delay; provided, however, that
Contractor shall use commercially reasonable efforts to mitigate any delay
caused by the foregoing circumstances; and, provided, further that the Contract
Time Schedule shall not be extended, and the Target Price shall not be increased
to the extent that the acts or omissions of Contractor directly contributed to
such delay.  If the Work is delayed due to the fault of Contractor
such that Contractor does not achieve Substantial Completion on or before the
applicable Milestone date set forth in the Contract Time Schedule, then the
Contract Time Schedule shall not be adjusted, the Target Price shall not be
increased, and Contractor shall pay Owner liquidated damages (LD’s) pursuant to
Addendum
1 to Exhibit
D.  Such LD’s owed by Contractor to Owner shall be limited to
one million dollars ($1,000,000) in the aggregate.   Such
liquidated damages shall be Owner’s sole remedy against Contractor for
Contractor’s failure to achieve any applicable Milestone and Contractor shall
not otherwise be liable for any direct, indirect, incidental, consequential or
other damages which may be suffered or incurred by Owner or others resulting
from any interruption or delay in start-up or use of, or production from, any of
Owner’s existing facilities or those to be designed hereunder.  LD’s
shall be assessed upon Substantial Completion of the final Milestone, and Owner
may deduct or off-set the LD’s from payment of the retainage pursuant to Section
10.1.1.2.

     

    
      	
               
      

            	
              13.

            	
              Insofar
      as Contractor is not responsible for inspection of equipment within its
      scope of Work, but is only responsible for providing the Engineering
      Services, Section 6.5 of the Agreement is hereby deleted in its entirety
      and replaced with the following:

            


    

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 4 of 13

                 

              


      

       

    

     

    
      	
               
      

            	
              6.5

            	
              [RESERVED]

            


    

     

     

    
      	
               
      

            	
              14.

            	
              Exhibit A to
      the Agreement is hereby amended and restated and replaced in its entirety
      with Exhibit A to this Change Order
3.

            


    

     

    
      	
               
      

            	
              15.

            	
              This
      confirms Owner’s January 16, 2009 direction for Contractor to suspend Work
      on the TCS Functional Areas as such TCS scope of Work is further clarified
      in Exhibit A to this Change Order 3 and by separate documentation between
      Owner and Contractor.  Owner intends for Contractor to resume
      Work on the TCS Functional Areas on or before April 1,
      2009.  The Target Price shall remain at $50 Million. Contractor,
      however, makes no representations that Contractor’s Work can be completed
      within such Target Price.

            


    

     

    
      	
               
      

            	
              16.

            	
              The
      third paragraph of Section 10.1.1 regarding payment of invoices is hereby
      deleted in its entirety and replaced with the
  following:

            


    

     

    Provided
that an Application for Payment is received by the Owner not later than the 1st
day of a month, the Owner shall make payment to the Contractor not later than
the 15th day of the same month. If an Application for Payment is received by the
Owner after the application date fixed above, payment shall be made by the Owner
not later than fifteen (15) days after the date it receives the Application for
Payment; provided, however that Owner shall have a seven-day grace period after
such payment date in which to make the payment before any interest or other
penalty shall accrue.

     

    
      	
               
      

            	
              17.

            	
              Sections
      12.3 through 12.3.4 of the Agreement are hereby deleted in their entirety
      and replaced with the following:

            


    

     

    12.3.
TERMINATION BY OWNER FOR CONVENIENCE.  Upon two days written notice to
Contractor, Owner may, without cause and without prejudice to any other right or
remedy of Owner, elect to terminate the Agreement.  In such case,
Contractor shall be paid for:

     

    12.3.1.
COMPLETED AND ACCEPTED WORK.  Completed and accepted Work executed in
accord with the Contract Documents prior to the effective date of termination at
the rates outlined in Exhibit D; and

     

    12.3.2.
EXPENSES.  Reasonable expenses sustained prior to the effective date
of termination in performing services and furnishing labor, materials, or
equipment as required by the Contract Documents in connection with uncompleted
Work at the rates outlined in Exhibit D.

     

    12.3.3.
[RESERVED]

     

    12.3.4.
TERMINATION EXPENSES.  Other reasonable and documented costs and
expenses that are directly attributable to the termination incurred by
Contractor after the effective date of termination, which amounts shall not to
exceed one percent (1%) of the Target Price, inclusive of any demobilization and
winding down costs.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 5 of 13

                 

              


      

       

    

     

    
      	
            	
              18. 

            	
              Effective
      upon submission of the next Application for Payment following the
      execution of this Change Order 3, Owner shall no longer withhold any
      retainage pursuant to Section 10.1.1.2 of the Agreement from any future
      Application for Payment; and, provided, further, that all retainage
      amounts previously withheld shall be paid to Contractor in three equal
      monthly payments beginning with payment of the invoice for Work in April,
      2009, through and including the invoice for Work in June,
      2009.

            


    

     

    
      	
               
      

            	
              19.

            	
              The Scope of Work as
      defined in pages 26 thru 29 of Exhibit A of the Agreement is hereby
      deleted in its entirety and replaced by the amended and restated
      Contractor’s Scope of Work as set forth on Exhibit A to
      this Change Order 3.  Schedule 1 and Appendix 1 to the original
      Exhibit A to the Agreement remain in effect as part of the
      Agreement.

            


    

     

    
      	
               
      

            	
              20.

            	
              Exhibit B of
      the Agreement (as amended by Change Order 2) is hereby deleted in its
      entirety and replaced with the amended and restated Contract Time Schedule
      as set forth on Exhibit B to
      this Change Order 3.

            


    

     

    
      	
               
      

            	
              21.

            	
              Exhibit D of
      the Agreement is hereby amended to delete Section 2 (regarding incentives)
      of Exhibit D of the Agreement in its
entirety.

            


    

     

    
      	
               
      

            	
              22.

            	
              Addendum 1 to
      Exhibit D (as
      amended by Change Order 2) is hereby deleted in its entirety and
      replaced with the amended and restated Addendum 1 to
      Exhibit D
      attached to this Change Order 3.

            


    

     

    
      	
               
      

            	
              23.

            	
              Pursuant
      to Section 15.9 of the Agreement (Notice), Owner hereby updates its notice
      addresses as follows:

            


    

     

     

    If to
Owner, to:

     

    HOKU
MATERIALS, INC.

    Attn:
Karl Taft

    One Hoku
Way

    Pocatello,
Idaho 83204

    Tel:  808-682-7800

    Fax:  808-440-0357

     

    With a
copy to:

     

    HOKU
SCIENTIFIC, INC.

    Attn:
Dustin Shindo

    1288 Ala
Moana Blvd, Suite 220

    Honolulu,
Hawaii 96814

    Fax:  (808)
440-0357

    Tel:  (808)
682-7800

     

    24.           The
Change Order 3 includes the Scope of Work and costs identified in Contractor’s
Change Notices 1 thru 45 and 47 thru 50.  Costs and impacts for Change
Notices 46, and 51 and above are not included in this Change Order
3.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 6 of 13

                 

              


      

       

    

     

    Owner and
Contractor agree that this Change Order 3 is a complete and final settlement and
shall serve as an accord and satisfaction for all change notices, Change Orders,
Modifications, and representations made and submitted by Contractor prior to the
effective date with the exception of Change Notice 46 and Change Notices above
50, which the Parties agree to hold open and include such scope, costs, and
impact in a later Change Order.  Except for the matters specifically
set forth above, this Change Order does not amend the Agreement.  In
the event of any disagreement between the terms of this Change Order,
the

    


    Agreement,
Change Order No. 1 and Change Order No. 2, the terms of this Change Order shall
be controlling.

    


    Please
sign below to acknowledge your agreement with this Change Order 3.

    


    Sincerely
yours,

    


    HOKU
MATERIALS, INC.

    


    


    By: 
/s/ Scott B. Paul

      
        

      

    

    Name: 
Scott B.
Paul

    Title: 
Chief Operating
Officer

     

     

    Acknowledged
and agreed as of February 19, 2009.

     

     

    STONE
& WEBSTER, INC.

    


    By: 
/s/ R.D. Sorbo

      
        

      

    

    Name: 
R.D.
Sorbo

    Title: 
Sr. VP,
Ethylene

     

    Cc:  Ric
Sorbo, Stone & Webster,
Inc., 1430 Enclave Parkway, Houston, TX 77077

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 7 of 13

                 

              


      

       

       

      Exhibit
A

    

    


    CONTRACTOR’S SCOPE OF
WORK

    


    This
Scope of Work (the “Scope of
Work”) further defines the Work to be performed by CONTRACTOR pursuant to
the Engineering, Procurement and Construction Management Agreement dated as of
August 7, 2007, between HOKU MATERIALS, INC. and STONE & WEBSTER, INC., as
amended from time to time pursuant to a Change Order  (the
“Agreement”).  Capitalized terms not otherwise defined herein are
defined in the Agreement.

    


    CONTRACTOR’s
Procurement services shall be performed pursuant to the Procurement Execution
Plan which is attached to the Agreement as Appendix
1 to Exhibit
A.

    


    This
Scope of Work is intended to totally define the Work required to design and
procure a completed polysilicon plant capable of producing 4,000 metric tons per
year of polysilicon (the “Project”),
which includes the following key areas (the “Functional
Areas”):

    


    [*]

     

    The
following additional areas (the “TCS Functional
Areas”) are included in the Scope of Work, and except as set forth in the
following clause, are included in the definition of Functional Areas; provided,
however, that as of the date of Change Order No. 3, all Work related to the TCS
Functional Areas is suspended pursuant to that certain written notice of
suspension from Owner to Contractor dated January 16, 2009.

    


    [*]

     

    The
Contractor’s Scope of Work includes integrating the Owner’s licensors for the
Functional Areas, ensuring that all proper steps have been taken to properly
integrate all energy and utilities for acceptable performance under all
scenarios including, but not limited to normal operation, emergency situations,
and unforeseen system glitches, and working with Owner’s general construction
contractor towards the successful construction of the Functional Areas, which
includes, without limitation, responding to requests for information, supporting
the permitting process, and working on design changes during
construction.  Design criteria will be in accordance to site specific
characteristics and Contractor does not guarantee the quantity or purity of the
polysilicon that the plant will ultimately produce.  Contractor will
however ensure that the integration of the Functional Areas, and utilities and
safety systems will allow for each Functional Area to operate as designed
pursuant to licensor deliverables.

     

    IT IS
EXPRESSLY UNDERSTOOD AND ACKNOWLEDGED BY CONTRACTOR THAT OWNER INTENDS TO
COMMENCE COMMISSIONING AND START-UP OF THE PLANT PRIOR TO FINAL COMPLETION, AND
THAT CONSTRUCTION WILL PROCEED DURING OPERATION OF THE PLANT.  IT IS
FURTHER ACKNOWLEDGED BY CONTRACTOR THAT OWNER INTENDS TO FIRST OPERATE THE PLANT
USING TRICHLOROSILANE THAT IS PURCHASED FROM A THIRD PARTY SUPPLIER, PRIOR TO
COMPLETION OF ON-SITE TRICHLOROSILANE PRODUCTION; HOWEVER, THE FUNCTIONAL AREAS
ARE TO BE DESIGNED TO ALLOW A SWITCH-OVER FROM THIRD PARTY TRICHLOROSILANE TO
TRICHLOROSILANE THAT IS GENERATED ON-SITE.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 8 of 13

                 

              


      

       

       

      PROJECT
DEVELOPMENT

    

    The Work
to be performed includes the preparation of the design basis (System Design
Specification, SDS) site plan and layout drawings, preliminary P&ID’s, scope
definition, preliminary specifications, equipment list, and preliminary
mechanical and electrical specifications for each of the Functional Areas, as
more fully described below.

    


    Throughout
the project development, Contractor will maintain an up-to-date schedule of the
Engineering Services and procurement will be maintained. This schedule will be
detailed enough as to allow the monitoring of all activities, especially those
on the critical path, and the detection of potential delays.

    


    PROJECT
APPROACH

    


    
      	
              A.

            	
              Contractor
      will provide Engineering Services and procurement services (in accordance
      with the Procurement Plant) for complete design of the Functional Areas
      with exceptions as noted herein.

            


    

     

    
      	
              B.

            	
              Contractor
      will provide the mechanical and control systems design for the Functional
      Areas and provide electrical and mechanical systems and
      civil/structural/architectural design as required by the State
      professional regulating agencies.

            


    

     

    
      	
              C.

            	
              Contractor
      will provide equipment procurement for equipment and materials as shown on
      the final P&IDs for the Functional Areas and in accordance with the
      Procurement Plan.  Owner will also select and retain vendors for
      specialty services.

            


    

     

    
      	
              D.

            	
              Engineering
      Services – Contractor will provide all Engineering Services required for
      construction and integration of the Functional Areas (excluding services
      provided by Owner as noted herein), including civil/architectural,
      structural, piping, equipment, electrical, heating, ventilation and air
      conditioning (HVAC), process design, and instruments and controls
      (I&C) (each of the foregoing eight discrete services is a “Engineering
      Discipline”), as more fully detailed
  below:

            


    

     

    
      	
               
      

            	
              1.

            	
              Process
      and mechanical design, to include:

            


    

     

    
      	
               
      

            	
              a.

            	
              Process
      and instrumentation diagrams
(P&IDs)

            


    

     

    
      	
               
      

            	
              b.

            	
              Plant
      and equipment arrangements drawings

            


    

     

    
      	
               
      

            	
              c.

            	
              Piping
      and equipment installation
specifications

            


    

     

    
      	
               
      

            	
              d.

            	
              Piping
      layout drawings, as necessary, to facilitate piping
      installation

            


    

     

    
      	
               
      

            	
              e.

            	
              Equipment
      and component procurement
specifications

            


    

     

    
      	
               
      

            	
              2.

            	
              Civil
      and structural design drawings and specifications,
  for:

            


    

     

    
      	
               
      

            	
              3.

            	
              HVAC
      design drawings and specifications

            


    

     

    
      	
               
      

            	
              4.

            	
              Electrical
      design including but not limited
to:

            


    

     

    
      	
               
      

            	
              a.

            	
              One
      line power distribution diagrams

            


    

     

    
      	
               
      

            	
              b.

            	
              Motor
      control elementaries

            


    

     

    
      	
               
      

            	
              c.

            	
              MCC
      room equipment location plans

            


    

     

    
      	
               
      

            	
              d.

            	
              Lighting
      plans

            


    

     

    
      	
               
      

            	
              e.

            	
              Power
      and lighting plans

            


    

     

    
      	
               
      

            	
              f.

            	
              Grounding
      and lightning protection plans

            


    

     

    
      	
               
      

            	
              g.

            	
              Electrical
      equipment procurement
specifications

            


    

     

    
      	
               
      

            	
              5.

            	
              Instrumentation
      and control design, to include:

            


    

     

    
      	
               
      

            	
              a.

            	
              Instrumentation
      procurement specifications

            


    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 9 of 13

                 

              


      

       

       

    

    
      	
               
      

            	
              b.

            	
              Instrumentation
      wiring diagrams

            


    

     

    
      	
               
      

            	
              c.

            	
              Control
      system hardware and software design

            


    

     

    SCOPE OF SUPPLY
(DELIVERABLES)

    


    
      	
              A.

            	
              Engineering
      Services.  All calculations, plans, lists, procedures, necessary
      for the design, and construction of the Functional Areas are included in
      this section.

            


    

     

    
      	
               
      

            	
              1.

            	
              Basic
      Engineering

            


    

     

    
      	
               
      

            	
              a.

            	
              General
      plot plant of the plant:

            


    

    
      	
               
      

            	
              i.

            	
              Plant
      layout

            


    

    
      	
               
      

            	
              ii.

            	
              Section
      and elevation plans

            


    

    
      	
               
      

            	
              iii.

            	
              General
      arrangement drawings

            


    

     

    
      	
               
      

            	
              b.

            	
              Process

            


    

    
      	
               
      

            	
              i.

            	
              Energy
      and mass balance

            


    

    
      	
               
      

            	
              ii.

            	
              Block,
      process flow and process and instrumentation
  diagrams

            


    

    
      	
               
      

            	
              iii.

            	
              Equipment
      list

            


    

    
      	
               
      

            	
              iv.

            	
              Equipment
      data sheets

            


    

    
      	
               
      

            	
              v.

            	
              Process
      description

            


    

    
      	
               
      

            	
              vi.

            	
              Nutrient
      and chemical data consumption sheet

            


    

    
      	
               
      

            	
              vii.

            	
              Utilities
      data consumption sheet

            


    

    
      	
               
      

            	
              viii.

            	
              Electric
      one-line diagram

            


    

    
      	
               
      

            	
              ix.

            	
              Architecture
      of the control system

            


    

     

    
      	
               
      

            	
              c.

            	
              Purchase
      specifications of the main
equipment

            


    

     

    
      	
               
      

            	
              2.

            	
              Detail
      Engineering

            


    

     

    
      	
               
      

            	
              a.

            	
              Mechanical
      and Piping

            


    

    
      	
               
      

            	
              i.

            	
              Orthographic

            


    

    
      	
               
      

            	
              ii.

            	
              Pipe
      isometrics

            


    

    
      	
               
      

            	
              iii.

            	
              “Hot
      lines” stress calculation

            


    

    
      	
               
      

            	
              iv.

            	
              Elements
      and components piping list

            


    

    
      	
               
      

            	
              v.

            	
              Drawing,
      design and/or design criteria for piping insulation and heat tracing,
      freeze protection

            


    

    
      	
               
      

            	
              vi.

            	
              Specifications
      for pumps, valves, pipes, fittings and line elements,
      insulation

            


    

    
      	
               
      

            	
              vii.

            	
              Pipe
      rack, others steel structures and platforms layout and typical details and
      design loadings

            


    

     

    
      	
               
      

            	
              b.

            	
              Electrical

            


    

    
      	
               
      

            	
              i.

            	
              Lightning
      protection and grounding plans

            


    

    
      	
               
      

            	
              ii.

            	
              List
      of electric equipment

            


    

    
      	
               
      

            	
              iii.

            	
              Layout
      of electric equipment and cable trays
routing

            


    

    
      	
               
      

            	
              iv.

            	
              Layout
      of MV switchgear, LV general panel boards and
  MCC

            


    

    
      	
               
      

            	
              v.

            	
              Technical
      specification of transformers, MV switchgear, LV general panel boards and
      MCC

            


    

    
      	
               
      

            	
              vi.

            	
              Technical
      specification of electric components, cables, trays, and
      conduits

            


    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 10 of 13

                 

              


      

       

    

     

    
      	
               
      

            	
              c.

            	
              Instrumentation
      and control

            


    

    
      	
               
      

            	
              i.

            	
              Control
      system specification

            


    

    
      	
               
      

            	
              ii.

            	
              Specification
      of control wires and
instrumentation

            


    

    
      	
               
      

            	
              iii.

            	
              List
      of control valves and data sheets

            


    

    
      	
               
      

            	
              iv.

            	
              List
      of instruments and data sheets

            


    

    
      	
               
      

            	
              v.

            	
              Location
      of instrumentation termination points will be provided in the
      Instrumentation Design Package

            


    

     

    
      	
               
      

            	
              d.

            	
              Civil
      Works and miscellaneous

            


    

    
      	
               
      

            	
              i.

            	
              Buildings
      plans, foundations, roads

            


    

    
      	
               
      

            	
              ii.

            	
              Drainages,
      storm water collection and waste water
systems

            


    

    
      	
               
      

            	
              iii.

            	
              Fire
      protection system plans and
specification

            


    

     

    
      	
               
      

            	
              e.

            	
              Record
      Drawings - Contractor will provide record drawings for the
      following:

            


    

    
      	
               
      

            	
              i.

            	
              Equipment
      general arrangement drawings

            


    

    
      	
               
      

            	
              ii.

            	
              Utilities
      drawings

            


    

    
      	
               
      

            	
              iii.

            	
              P&IDs

            


    

    
      	
               
      

            	
              iv.

            	
              Manufacturer’s
      shop drawings

            


    

    
      	
               
      

            	
              v.

            	
              Electrical
      single lines

            


    

    
      	
               
      

            	
              vi.

            	
              Electrical
      panel drawings

            


    

    
      	
               
      

            	
              vii.

            	
              As-Built
      Drawings shall be the responsibility of Owner or Owner’s construction
      contractor.

            


    

     

    
      	
            	
              3.

            	
              Construction
      Engineering.  During construction of the plant, Contractor shall
      respond to requests for information from Owner, Owner’s construction
      contractor, and any other third party that is designated by Owner, to
      support the on-going design and engineering of the Project during
      construction, and until final completion of the
  Project.

            


    

     

    
      	
            	
              4.

            	
              Operation
      and Maintenance Handbooks.  Operating and maintenance
      manuals for equipment procured by Contractor will be provided after
      commissioning.  All drawings, vendor data, programming,
      operating procedures and training manuals will be provided in electronic
      and hard copy format wherever possible.  Five copies will be
      provided.  The vendor Maintenance Manuals will provide detailed
      information, descriptions and procedures for maintaining all equipment
      throughout the plant as procured by Contractor.  It will include
      such things as equipment lists, drawings, product data, warranties,
      maintenance and repair schedules, calibration procedures, and trouble
      shooting techniques.  Five copies will be
    provided.

            


    

     

    
      	
               
      

            	
              5.

            	
              Final
      documentation will be provided to Owner, in the form of hard copy and
      electronic files wherever possible.  This will include, but not
      be limited to:

            


    

     

    
      	
               
      

            	
              ·

            	
              Drawing/Specifications
      (including electronic files)

            


    

    
      	
               
      

            	
              ·

            	
              DCS
      Logic

            


    

    
      	
               
      

            	
              ·

            	
              HMI
      Screen Work

            


    

    
      	
               
      

            	
              ·

            	
              Training
      Manuals for Contractor supplied
Equipment

            


    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 11 of 13

                 

              


      

       

      Exhibit
B

    

    


    CONTRACT
TIME SCHEDULE

    


    The
following Contract Time Schedule is attached as Exhibit B to the Engineering and
Procurement Agreement dated as of August 7, 2007, as amended by Change Order 3,
between HOKU MATERIALS, INC. and STONE & WEBSTER, INC. (the
“Agreement”).  Capitalized terms not otherwise defined herein are
defined in the Agreement.

    


    [*]

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 12 of 13

                 

              


      

       

       

      Exhibit B
Clarifications

    

    


    
      	
               
      

            	
              1.

            	
              The
      dates shown in Exhibit B exclude the impact of modifying the design of the
      plant to incorporate the changes required to achieve safe and practical
      operation of the plant in Partial Commercial Operation (PCO) mode as the
      interface points and related scope has not been fully
    defined.

            


    

    


    
      	
               
      

            	
              2.

            	
              Civil,
      structural, and electrical drawings require the approval of local
      authorities.  In Exhibit B, 14 calendar days have been allowed
      from the IFC (Issued For Construction) date to the IFC approval
      date.  If the approval of the drawings is delayed by the local
      authorities or there are minor comments that require Shaw response, the
      milestone is considered to have been met.  Shaw will respond to
      all comments from the local authorities in a timely
  manner.

            


    

    


    
      	
               
      

            	
              3.

            	
              The
      dates shown for the civil and structural disciplines are the dates to
      complete the major structures and foundations.  The dates
      exclude the drawings required for such items as miscellaneous pipe
      supports, which are to be issued later in the design
  cycle.

            


    

    


    
      	
               
      

            	
              4.

            	
              The
      I&C dates include the drawings required for construction and the loop
      drawings that are required for plant
checkout.

            


    

    


    
      	
               
      

            	
              5.

            	
              The
      Piping dates shown are for the issue of piping
  isometrics.

            


    

    


    
      	
               
      

            	
              6.

            	
              The
      dates shown for all disciplines include the release of any holds that
      impact construction.

            


    

    


    
      	
               
      

            	
              7.

            	
              The
      dates shown in Exhibit B represent the time to complete the Shaw scope of
      work for PCO as the scope was defined on 16-January-09, which scope is
      subject to further clarification per item
#1.

            


    

    


    
      	
               
      

            	
              8.

            	
              Delays
      caused by lack of, or changes in, vendor or licensor information are
      excluded from the LD dates shown in Exhibit B.  When Shaw
      recognizes a delay caused by Hoku, vendors or licensors, Shaw will
      immediately notify Hoku with the nature of the delay and any related
      schedule impact.  [*].

            


    

    


    
      	
               
      

            	
              9.

            	
              Shaw
      shall issue a letter to Hoku declaring the date when each milestone has
      been achieved.

            


    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	
                Mr. Mel
      Barnett

                Stone & Webster,
      Inc.

                February 19, 2009

                Page 13 of 13

                 

              


      

       

       

      Addendum 1 to Exhibit
D

    

     

    This
Addendum 1 to Exhibit D of the Agreement replaces in its entirety the Addendum 1
to the Engineering, Procurement and Construction Management Agreement dated as
of August 7, 2007, as modified by Change Order 3. Capitalized terms not
otherwise defined herein are defined in the Agreement.

    


    Except as
otherwise set forth in Section 6.3 of the Agreement, in the event that the
Milestones set forth on the Contract Time Schedule are not achieved by the
applicable dates, then Contractor shall pay Owner liquidated damages (“LD’s”)
pursuant to Section 6.3 of the Agreement in accordance with the following
formula:

    


    
      	
               
      

            	
              1.

            	
              Each
      of the Engineering Disciplines (as defined on Exhibit A) that
      are identified on the table below shall be liable for the maximum amount
      of liquidated damages described in the following table (the “LD
      Cap”):

            


    

     

    
      	 	
              Engineering
      Discipline:

            	 	
              Civil/Arch

            	 	 	
              Structural

            	 	 	
              Piping

            	 	 	
              Electrical

            	 	 	
              I&C

            	 
	 	
              LD’s:

            	 	$	125,000	 	 	$	125,000	 	 	$	250,000	 	 	$	250,000	 	 	$	250,000	 


    

     

    
      	
               
      

            	
              2.

            	
              Each
      Milestone shall have a five-day grace period (the “Grace
      Period”) before any LD’s accrue, up to a combined aggregate total
      grace period of fifteen (15) days of delays for all Milestones within each
      Engineering Discipline.  Once there have been an aggregate of
      fifteen (15) days of delays for one or more Milestones in any given
      Engineering Discipline, there shall be no further Grace Period for any
      Milestone within that Engineering Discipline.  After expiration
      of the Grace Period, LD’s shall accrue according to the following table up
      to the LD Cap for each Engineering
Discipline.

            


    

    


    
      	 	
              No.
      of calendar days after

              expiration
      of Grace Period

            	 	
              LD
      amount per calendar day

            	 
	 	 
      	 	
              Civil/Arch

            	 	 	
              Structural

            	 	 	
              Piping

            	 	 	
              Electrical

            	 	 	
              I&C

            	 
	 	
              1-5

            	 	$	2,500	 	 	$	2,500	 	 	$	5,000	 	 	$	5,000	 	 	$	5,000	 
	 	
              6-10

            	 	$	5,000	 	 	$	5,000	 	 	$	10,000	 	 	$	10,000	 	 	$	10,000	 
	 	
              11-15

            	 	$	10,000	 	 	$	10,000	 	 	$	20,000	 	 	$	20,000	 	 	$	20,000	 
	 	
              16+

            	 	$	12,500	 	 	$	12,500	 	 	$	25,000	 	 	$	25,000	 	 	$	25,000