Document:

Unassociated Document

    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.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    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.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    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.]

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    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

                        

                

              

            

          

        

      

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

      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.CONFIDENTIAL

              
	 
      	 
      
	 
      	
                Exhibit
      10.117

              

      

    

     

    [*]
= 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. 1 TO

     

    SUPPLY
AGREEMENT

     

    This
Amendment No. 1 to Supply Agreement (this “Amendment”)
is entered into as of the last date set forth on the signature page hereto
between SHANGHAI ALEX NEW ENERGY CO.,  LTD. (hereinafter “ALEX”) and
HOKU MATERIALS,
INC., a Delaware corporation (hereinafter “HOKU”).  HOKU
and ALEX are sometimes referred to in the singular as a “Party” or
in the plural as the “Parties”.

     

    Recitals

     

    Whereas,
HOKU, ALEX, and SHANGHAI HUAYI ENTERPRISES GROUP, as guarantor, are parties to
that certain Supply Agreement dated as of February 27, 2009 (the “Supply
Agreement”), pursuant to which ALEX has agreed to purchase from HOKU, and
HOKU has agreed to sell to ALEX, specified volumes of polysilicon each year over
a ten year period; and

     

    Whereas,
HOKU and ALEX desire to amend certain provisions of the Supply Agreement as set
forth herein to delay the first shipment of polysilicon by HOKU to ALEX until no
later than September 30, 2010;

     

    NOW,
THEREFORE, in furtherance of the foregoing Recitals and in consideration of the
mutual covenants and obligations set forth in this Amendment, the Parties hereby
agree as follows:

     

    Agreement

     

    1.           Definitions.  Unless
otherwise defined herein, capitalized terms used in this Amendment shall have
the meanings set forth in the Supply Agreement.

     

    2.           Amendments.  The
following provisions of the Supply Agreement are amended or amended and restated
as follows.

     

    2.1.    
 Section 2.3 of the Supply Agreement is hereby amended and restated in its
entirety to read as follows:

     

    2.3
       “First Shipment
Date” shall mean the first day when HOKU commences deliveries to ALEX of
Products pursuant to this Agreement.

     

    2.2.      Section
4.3 of the Supply Agreement is hereby amended and restated in its entirety to
read as follows:

     

    
      
        	
                ALEX Initials & Date

              	
                   JGL     LWZ   12/23/2009

              	  	
                HOKU Initials & Date

              	
                    DS     12/30/2009

              

      

    

     

    
      
        
        

      

      
        
          Page
1 of 3

        

        
          

        

      

      
        
        

      

    

     

    
      	 
      	
              CONFIDENTIAL

            
	 
      	 
      
	 
      	
              Exhibit
      10.117

            

       

    

    4.3        Except
in the case of a force majeure pursuant to Section 13 below, if at any time
after January 01, 2011, HOKU does not supply any Products pursuant to Section
4.1 or 4.2 within [*] days of the scheduled delivery date, HOKU will provide
ALEX with a purchase price adjustment. Such purchase price adjustment shall be
[*] of the value of the respective delayed Products for each week or part
thereof that the Product shipment (or part thereof) is delayed beyond the [*]
day grace period. In addition, the Price Adjustment shall apply to any late
shipments between September 30, 2010 and December 31, 2010, without any grace
period. Any purchase price adjustment as a result of this Section 4.3 will be
paid by HOKU at the end of the term of the applicable calendar
quarter.  In lieu of making a cash payment to ALEX pursuant to this
Section 4.3, HOKU may, at its option, pay for such purchase price adjustment in
the form of a credit issued for future shipments of Products. Notwithstanding
anything to the contrary, the maximum amount of such purchase price reduction is
limited to [*] percent ([*]%) of the value of the respective delayed
Products.  Monthly shipments which are delayed beyond [*] days shall
be deemed to constitute a material breach of this Agreement pursuant to Section
10.2.1 below.  Notwithstanding the foregoing, if ALEX fails to make a
payment to HOKU within the [*]-day period set forth in Section 6.4 below, HOKU
shall not be required to supply any Product to ALEX until HOKU has received the
past due amount including any interest payable thereon pursuant to this
Agreement.  For the avoidance of doubt, ALEX’s right to reduce the
purchase price pursuant to this Section 4.3 shall not apply if HOKU is not
fulfilling its supply obligations for this reason. Monthly shipments which are
delayed more than [*] days in a calendar year AND are less than [*]% of [*] of
the Minimum Annual Quantity of Product shall be deemed to constitute a material
breach of this Agreement pursuant to Section 10.2.1.

     

    2.3.      Section
5.2 of the Supply Agreement is hereby amended such that the reference to January
10, 2009, is changed to September 30, 2010, and the reference to October 1,
2009, is changed to June 30, 2010.

     

    2.4.      Section
5.3 of the Supply Agreement is hereby deleted in its entirety, and replaced with
the following:

     

    “5.3       Reserved.”

     

    2.5.      Section
10.2.6 of the Supply Agreement is hereby amended such that the reference to
March 31, 2010, is changed to December 31, 2010.

     

    3.           This
Amendment, together with the Supply Agreement, constitutes the entire agreement
between the Parties concerning the subject matter hereof.  Except as
specifically amended herein, the terms of the Supply Agreement shall continue in
full force and effect without modification or amendment.

     

    [This
space intentionally left blank.]

     

    
      	
              ALEX Initials & Date

            	
                 JGL     LWZ   12/23/2009

            	  	
              HOKU Initials & Date

            	
                  DS     12/30/2009

            

    

     

    
      
        
        

      

      
        
          Page
2 of 3

        

        
          

        

      

      
        
        

      

    

     

    
      	 
      	
              CONFIDENTIAL

            
	 
      	 
      
	 
      	
              Exhibit
      10.117

            

       

    

    IN
WITNESS WHEREOF, the Parties have executed this Amendment No. 1 to Supply
Agreement as of the last date set forth below.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        ALEX:

                                      	 	
                                        HOKU:

                                      
	 
      	 	 
      
	
                                        SHANGHAI
      ALEX NEW ENERGY CO.,
LTD.

                                      	 	
                                        HOKU
      MATERIALS, INC.

                                      
	 
      	 	 
      
	
                                        By:

                                      	
                                        /s/ Jian Gang Li

                                      	 
      	 
      
	 
      	 
      	 	
                                        By:

                                      	
                                        /s/ Dustin Shindo

                                      
	
                                        Name:

                                      	
                                        Jian Gang Li

                                      	 
      	 
      	 
      
	 
      	 
      	 	
                                        Name:

                                      	
                                        Dustin Shindo

                                      
	
                                        Title:

                                      	 
      	 	 
      	 
      
	
                                        Authorized
      Signatory

                                      	 	
                                        Title:

                                      	
                                        Chief Executive Officer

                                      
	 
      	 	
                                        Authorized
      Signatory

                                      
	
                                        Date:

                                      	
                                        December 23, 2009

                                      	  	 
      
	 
      	 	
                                        Date:

                                      	
                                        December 30, 2009

                                      
	 
      	 	 
      
	
                                        GUARANTOR:

                                      	  	 
      
	 
      	 	 
      
	
                                        SHANGHAI
      HUAYI ENTERPRISES
GROUP

                                      	 	 
      
	 
      	 	 
      
	
                                        By:

                                      	
                                        /s/ Lian Wen Zhang

                                      	  	 
      
	 
      	 
      	 	 
      
	
                                        Name:

                                      	
                                        Lian Wen Zhang

                                      	  	 
      
	 
      	 
      	 	 
      
	
                                        Title:

                                      	 
      	 	 
      
	
                                        Authorized
      Signatory

                                      	 	 
      
	 
      	 	 
      
	
                                        Date:

                                      	
                                        December 23, 2009

                                      	  	 
      

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    Signature
Page to Amendment No. 1 to Supply Agreement

     

    
      
        
        

      

      
        
          Page
3 of 3

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