Document:

Security Agreement by and between Central Pacific Bank and Registrant

 Exhibit 10.27 
  
 SECURITY AGREEMENT 
  
 THIS SECURITY AGREEMENT (Security Agreement) made this 9th day of June, 2005, by and between HOKU SCIENTIFIC, INC., a Delaware corporation (hereafter called the Debtor), and CENTRAL PACIFIC BANK, a Hawaii corporation (hereafter called the Secured Party),

  
 W I T N E S S
E T H : 
  
 To secure the repayment of a loan
made by the Secured Party to the Debtor in the principal amount of THREE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($3,500,000.00), together with interest thereon, which loan is evidenced by that certain Promissory Note of even date herewith
executed by the Debtor, as Borrower, and payable to the Secured Party, the provisions of such Note and any modifications, extensions or renewals thereof being secured hereby, being incorporated herein by reference, and being hereinafter referred to
as the Note; 
  
 AND ALSO to secure the performance and observance
by the Debtor of all of the covenants, conditions and agreements required to be performed by the Debtor under this Agreement and under the Mortgage, Security Agreement and Financing Statement (hereinafter called the Mortgage) executed by the Debtor
and the Secured Party concurrently herewith and under any other documents or instruments executed concurrently herewith by the Debtor (the Note, the Mortgage and this Security Agreement being hereinafter collectively called the Loan Documents), and
the payment by the Debtor to the Secured Party of all sums expended or advanced by the Secured Party pursuant to any term or provision of any of the Loan Documents, the provisions of which documents and all amendments thereto being incorporated
herein by reference; 
  
 AND ALSO to secure the payment by the
Debtor to the Secured Party of all other sums now or hereafter loaned or advanced by the Secured Party to the Debtor, pursuant to the provisions of the Loan Agreement of even date herewith (hereinafter called the Loan Agreement), or expended by the
Secured Party for the account of the Debtor; 
  
 THE DEBTOR DOES
HEREBY grant, assign, convey, transfer, deliver and set over to the Secured Party, its successors and assigns, absolutely and forever, the following described property, TOGETHER WITH a security interest, as that term is defined in the Uniform
Commercial Code (Chapter 490, Hawaii Revised Statutes, as amended), in such property, upon the terms and conditions hereinafter set forth: 
  
 FIRST: All right, title and interest of the Debtor in and to any and all existing and future contracts involving or relating to the
property located at 1075 Opakapaka 

  

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Street, Kapolei, City and County of Honolulu, Hawaii, Tax Map Key No. (1) 9-1-075-009, which is more particularly described in the Mortgage and is hereafter
called the Property, and the structures and improvements thereon, or any of the other items of Collateral described herein, including any and all modifications and extensions thereof; 
  
 Together with all of the Debtor’s rights and remedies thereunder and the benefit of all covenants
therein; 
  
 SECOND: All right, title and
interest of the Debtor in and to any and all binders or policies of insurance of any kind (the Insurance Policies) covering all or any portions of the Property or any of the other items of Collateral described herein; and any and all riders,
amendments, extensions, renewals, supplements or revisions thereof; 
  
 Together with all of the Debtors rights and remedies there under, the benefit of all covenants therein and all proceeds there from; 
  
 THIRD: All right, title and interest of the Debtor in and to all of the Debtor’s personal
property of any kind, including, without limitation, all machinery, equipment, building materials, furniture, fixtures, furnishings, fittings, attachments, appliances, devices and appurtenances of every kind and description, now or hereafter affixed
to, placed upon or used in connection with the construction of, the improvements on the Property, intended to be incorporated into such improvements, substantially consumed in such construction operations, or specially fabricated for incorporation
in such improvements as well as all Debtor’s personal property of any kind and description purchased for use in connection with such improvements, whether or not affixed to or placed upon the Property; together with all additions to,
substitutions for, changes in, replacements or renewals of, the whole or any part of such property; 
  
 FOURTH: All right, title and interest of the Debtor in and to any and all awards or payments, including interest thereon, and the
right to receive the same, which may be made with respect to the premises by any public or quasi-public authority or corporation as a result of (a) the exercise of the right of eminent domain, (b) the alteration of the grade of any street, or (c)
any other injury to or decrease in the value of the Property, to the extent of all amounts which may be secured by the Mortgage at the date of receipt of any such award or payment by the Secured Party, including the counsel fee, costs and
disbursements incurred by the Secured Party in connection with the collection of such award or payment, the Debtor agreeing to execute and deliver, from time to time, such further instruments as may be requested 

  

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by the Secured Party to confirm such assignment to the Secured Party of any such award or payment; 
  
 FIFTH: All right, title and interest of the Debtor in
and to any instruments, documents, general intangibles and accounts (as those terms are respectively defined in Section 490:9-102, Hawaii Revised Statutes, as amended, or hereafter defined under the Uniform Commercial Code (UCC)) with respect to, or
which may in any way pertain to, the Property or the business of the Debtor, now existing or hereafter arising, including, without limitation (i) any trade names, trademarks, prints, labels, advertising concepts and literature, and (ii) all refunds,
rebates, deposits, accounts receivable or other expectancy under or from any account or contract; 
  
 SIXTH: All right, title and interest of the Debtor in and to all building permits, other permits, licenses, soils tests,
appraisals, plans and specifications and any other documents and agreements, materials or personal property of any kind now or hereafter existing for the Property or the business of the Debtor and belonging to the Debtor; 
  
 SEVENTH: All right, title and interest of the Debtor
in and to all construction contracts, architect’s and engineer’s contracts now or hereafter entered into by the Debtor for the construction of any improvements on or work performed to the Property, and any and all modifications and
extensions thereof, together with all of the Debtor’s rights and remedies thereunder and the benefits of all covenants therein; and 
  
 EIGHTH: All right, title and interest of the Debtor in and to all performance and payment bonds now or hereafter obtained by the
Debtor in connection with the construction of the improvements on or work performed to the Property, together with all of the Debtors rights and remedies thereunder and the benefit of all covenants therein; 
  
 The Contracts and the Insurance Policies are hereinafter
sometimes collectively called the Contracts. All articles of property described in items THIRD through EIGHTH are hereinafter sometimes collectively called the Personal Property. The Contracts and the Personal Property are herein sometimes
collectively called the Collateral. 
  
 TOGETHER WITH all right,
title and interest of the Debtor in, and to use, lease or dispose of, the Collateral as well as any proceeds deriving from such Collateral; 
  
 TO HAVE AND TO HOLD the same unto the Secured Party and its successors and assigns, absolutely and forever, as security as aforesaid; 
  

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 UPON CONDITION that if the Debtor shall well and truly pay to the Secured Party the principal amount of
the Note, with interest and other charges, if any, according to its provisions and effect and shall discharge any and all obligations that now or hereafter may be or become owing, directly or indirectly, by the Debtor to the Secured Party under the
Loan Documents on any and every account, whether or not the same are matured, of which obligations the books of the Secured Party shall be prima facie evidence, and if the Debtor shall fully and faithfully perform and observe all of
the covenants, conditions and agreements to be performed and observed by the Debtor in the Loan Documents, including this Security Agreement, and any and every other instrument or document secured hereby, and if the Debtor shall pay the cost of
release, the Secured Party will, upon request of the Debtor, release the Collateral from the security interest created by this Agreement and these presents shall be void, it being understood, however, that an affidavit, certificate, letter or
statement of any officer of the Secured Party showing that any part of the indebtedness remains unpaid or any terms, covenants, conditions, and agreements remain unperformed shall constitute conclusive evidence of the validity, effectiveness and
continuing force of this Security Agreement. 
  
 Subject to the
terms hereof, until the happening of an Event of Default as defined in the Loan Agreement, the Debtor shall be entitled to use and to possess the Collateral. 
  
 BUT, if any Event of Default as defined in the Loan Agreement shall occur, then the Secured Party, without obligation to do so and without releasing or
waiving any of its rights, shall have the right, power and authority, without notice, presentment or demand to declare the unpaid principal amount of the Note and any other indebtedness secured hereby, hereby whether matured or not, together with
any interest thereon accrued and unpaid, to be immediately due and payable, and such indebtedness and interest shall thereupon become and be immediately due and payable, and shall bear interest until fully paid at the rate specified in the Note to
be paid in the event of default, and the Secured Party may, at its option, without notice and irrespective of whether declaration of default is required to be delivered to any party named in the Loan Documents or other instrument or obligations
securing the Note or secured hereunder or whether remedies under other security instruments have been exercised, exercise all right and remedies contained in the Loan Documents, including this Security Agreement, or any other security instruments
and obligations and shall have all rights and remedies available to the Secured Party under the Uniform Commercial Code or other applicable laws. 
  
 Without limiting the generality of the foregoing, upon the occurrence of an Event of Default: 
  
 (a) The Secured Party may, at the Secured Party’s
option and at the Debtor’s expense, either in the Secured Party’s own right or in the name of the Debtor and in the same manner and to the same extent that the Debtor might reasonably so act if this Security Agreement had not been made,
(i) demand, sue for, collect, recover, receive and otherwise enforce payment of all proceeds and other 

  

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sums due and payable from the Collateral, the Debtor hereby requesting and instructing all other parties to the Contracts or liable to the Debtor in
connection with the Collateral to make all payments then due or which may thereafter become due thereunder or thereby to the Secured Party, and the Debtor further agreeing that the receipt by the Secured Party of any such payments shall be a
complete release and discharge of the obligor or obligors thereof to the extent of the payment or payments so made; (ii) do all things requisite, convenient or necessary to enforce the performance and observance of any and all other covenants,
agreements, conditions, terms and provisions of the Contracts, and to exercise all the rights, remedies and privileges of the Debtor contained in the Contracts or arising from the Collateral or any part thereof, including, but not limited to, the
making, modifying, amending, enforcing, cancelling, surrendering or accepting the surrender of, terminating or extending any of the Contracts now or hereafter in effect, and also including the compromising, waiving, excusing, or in any manner
releasing or discharging of any obligation of any party to or arising from the Collateral; (iii) take possession of the books, papers and accounts of the Debtor, wherever located, relating to the Collateral; (iv) receive, and the Debtor will
forthwith surrender to the Secured Party the possession of the Collateral, and, to the extent permitted by law, the Secured Party may itself or by such officers or agents as it may appoint (A) manage or operate the Collateral or any part thereof,
(B) exclude the Debtor, its agents and servants therefrom, (C) make, enforce, modify and accept the surrender of any Contracts or leases covering all or any portion of the Property,(D) obtain and evict tenants, fix or modify purchase prices or
rents, fill any and all vacancies and lease the Property or Personal Property, or any part thereof, and (E) do all acts, including the making of contracts, which the Secured Party deems necessary for the care or management of the Property or
Personal Property; (v) sue or otherwise collect and receive monies; and (vi) do all other things requisite, convenient or necessary to require the other parties to the Contracts to perform the same or which the Secured Party deems proper to protect
the security given hereunder. 
  
 (b) The Secured
Party may foreclose this Security Agreement in the manner now or hereafter provided or permitted by law, including treatment of the Collateral as real property subject to judicial foreclosure pursuant to Chapter 667, Hawaii Revised Statutes, as
amended, and shall have the immediate right to receivership on ex parte order and without bond pending foreclosure, and may sell, assign, transfer or otherwise dispose of the Collateral at public or private sale, in whole or in part,
and the Secured Party may, in its own name or as the irrevocably appointed attorney-in-fact of the Debtor, effectually assign and transfer the Collateral, or any part thereof, absolutely and execute and deliver all necessary assignments, deeds,
conveyances, bills of sale and other instruments with power to substitute one or more persons or corporations with like power; and, if the Secured Party so instructs the Debtor, the Debtor shall assemble, without expense to the Secured Party,

  

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all of the Collateral at a convenient place on the Island of Oahu, at the Secured Party’s option, and the Debtor shall ratify and confirm any such sale
or transfer by delivering all proper instruments to such persons or corporations as may be designated in any such request. Any such foreclosure sale, assignment or transfer shall, to the extent permitted by law, be a perpetual bar, both at law and
in equity, against the Debtor and all persons and entities lawfully claiming by or through or under the Debtor. Any such sale may be adjourned from time to time. The Secured Party shall give the Debtor notice of any public or private sale as may be
required by the UCC. Upon any sale, the Secured Party may bid for and purchase the Collateral, or any part thereof, and upon compliance with the terms of sale, may hold, retain and possess and dispose of the Collateral, in its absolute right without
further accountability, and any purchaser, including the Secured Party, at any such sale may, if permitted by law, after allowing for the proportion of the total purchase price required to be paid in cash for the costs and expenses of the sale,
commissioner’s compensation and other charges, in paying purchase money, turn in the Note, including interest and charges thereon, in lieu of cash, up to the amount which shall, upon distribution of the net proceeds of such sale, be payable
thereon. 
  
 In case of any Event of Default, neither the Debtor
nor anyone claiming by, through or under the Debtor, to the extent the Debtor may lawfully so agree, shall or will set up, claim or seek to take advantage of any appraisement, valuation, stay, extension or redemption law now or hereafter in force in
any locality where any of the Collateral is situated in order to prevent or hinder the enforcement of this Security Agreement, or the absolute sale of the Collateral or the final and absolute putting into possession thereof, immediately after such
sale, of the purchasers thereat; and the Debtor in the Debtor’s own right and for all who may claim under the Debtor, hereby waives, to the full extent that the Debtor may lawfully do so, the benefit of all such laws and any and all right to
have the estates comprised in the security intended to be created hereby marshalled upon any enforcement of the lien hereof and agrees that the Secured Party or any court having jurisdiction to foreclose such lien may sell the Collateral in parts or
as an entirety. The Secured Party may apply the proceeds of any such sale first, to the costs and expenses of such sale and all proceedings in connection therewith, including counsel fees; next, to the payment of any disbursements made
by the Secured Party for taxes or assessments or other charges prior to the security interest of this Security Agreement which the Secured Party shall deem it expedient to pay; next, to the repayment of any other disbursements made by the
Secured Party according to the terms hereof; and next, to the payment of the unpaid principal of an interest or other charges on the Note, and any other obligations of the Debtor under the Loan Documents; and the remainder, if any, shall be
paid over to the Debtor. If such proceeds shall be insufficient to discharge the entire indebtedness owing by the Debtor under this Security Agreement, the Loan Documents and any other instrument or obligation secured hereunder, the Secured Party
may have any other legal recourse against the Debtor for the deficiency. 
  
 Nothing in this Agreement or the Note shall affect or impair the right, which is unconditional and absolute, of the holder of the Note to enforce payment of the principal or any 

  

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interest on the Note and all fees, charges and other sums due under the Loan Documents at or after the date therein expressed as the date when the same shall
become due, or the obligation of the Debtor secured hereunder, which is likewise unconditional and absolute, to pay such amounts at the respective times and places therein expressed. 
  
 A. DEBTOR’S WARRANTIES. The Debtor warrants and represents to the Secured Party as follows: 
  
 1. The Debtor is a party to each of the Contracts and is the
absolute and sole owner of the interest in and to the Contracts subject to this Security Agreement, and, subject to the terms thereof, with full right and title to assign the same to the Secured Party and to grant the Secured Party a security
interest in the same and the sums due or to become due thereunder; the Debtor has to date fully and faithfully performed and observed all of the terms, obligations, covenants, conditions and warranties to be performed and observed by the Debtor
thereunder and no event has occurred and is continuing which constitutes, or with notice or the passage of time would constitute, a default thereunder; the Contracts are genuine, valid, subsisting and enforceable upon all parties thereto according
to their terms; the Debtor has not alienated, assigned, pledged, transferred, mortgaged or otherwise encumbered any of the rights or interests of the Debtor therein or thereto, including the sums due or to become due thereunder, there have been no
amendments or modifications to any of the Contracts; no financing statement or any other lien or encumbrance covering any of the Collateral is on file in the Bureau of Conveyances of the State of Hawaii, or is otherwise outstanding; the other
parties to the Contracts have no offsets, counterclaims or defenses against the Debtor, whether arising out of the Contracts or otherwise; no payments of any kind required thereunder have been anticipated, discounted, waived, released or set-off; no
parties thereto have been discharged, excused or released; no claims under the Contracts have been compromised; the Debtor has not accepted any payments under any of the Contracts, except as permitted by the terms thereof; all payments thereunder
are current; and nothing in any of the Contracts would prevent the Secured Party from enforcing any of the rights and remedies that the Debtor might have if this Security Agreement had not been executed. 
  
 2. The Debtor is the lawful owner or lessee of the Personal
Property and has the right to the use and possession of the Personal Property and has good right to grant or convey the same as security under this Security Agreement; the Personal Property is free and clear of any lien or right prior to or on a
parity with the lien of this Security Agreement, except as noted above; the Debtor will, on behalf of the Secured Party, defend forever against any claims or demands thereon made by all persons; and there exist no offsets, counterclaims or defenses
to the Debtor’s rights therein or thereto. 
  
 3. The Debtor’s exact and correct legal name is as set forth in the first paragraph of this Security Agreement. The Debtor is registered and in good standing in the State of Delaware and the State of Hawaii. 
  

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 B. DEBTOR’S COVENANTS. The Debtor hereby covenants and agrees with the Secured Party as
follows: 
  
 1. Payment of Taxes, Assessments,
Etc. The Debtor will punctually pay and discharge, or cause to be paid and discharged from time to time as the same shall become due, all taxes, rates, assessments, impositions, duties and other charges of every description to which the
Collateral, or any part thereof, may during the term of this Security Agreement become liable by authority of law, the payment of which shall be secured by this Security Agreement. The Debtor will, upon request, deposit copies of the receipts
therefor with the Secured Party at least thirty (30) days prior to the final date such taxes, rates, assessments, impositions, duties and other charges may be paid without penalty. 
  
 2. Preservation of Contracts. Without the prior written consent of the Secured Party, the Debtor will
not: (a) modify, change, alter, extend, terminate, cancel, tender or accept surrender of any of the Contracts; (b) reduce, discount, compromise, settle, waive, release or set-off the amount of any sums payable thereunder, vary the terms of payment
or otherwise change, alter or modify the same, or consent to the subordination of interest of any part thereto, or waive, excuse, condone or in any manner release or discharge any party thereunder of or from their respective obligations, covenants,
conditions and agreements required to be performed; (c) execute any agreement which would prevent the Secured Party from acting as the Debtor, as provided herein; nor (d) alienate, assign, pledge, transfer or encumber any of the rights or interests
of the Debtor therein or thereto, including the sums due or to become due thereunder. 
  
 3. Performance. The Debtor will fully and faithfully abide by, observe and discharge, perform and enforce the performance of the
terms, obligations covenants, conditions, agreements and warranties required to be performed and observed under each of the Contracts, in respect of the Personal Property and under the Loan Documents, including this Security Agreement, and any other
instrument secured hereunder, and will give prompt notice to the Secured Party of any default thereunder, whether by the Debtor or by any party thereto, together with an accurate and complete copy of any notice either received or sent by the Debtor.
The Debtor will not anticipate, discount, compromise, settle, waive, release or set off any sums due under the Contracts or in respect of the Personal Property or receive any sums in any manner inconsistent with the provisions of the Contracts or
this Security Agreement. 
  
 4.
Indemnification. The Debtor will indemnify and hold and save the Secured Party harmless from and against any and all liability, loss, damage or expense of whatever kind or nature, including attorney’s fees, which the Secured Party may at
any time sustain or incur hereunder, including, but not limited to, any claims or demands whatsoever which may be asserted against the Secured Party as a result of any failure on the part of the Debtor to perform, observe or discharge its
obligations under any of the Contracts or involving any of the Collateral. Prior to the actual entry and taking possession of any property by the Secured Party, this Security Agreement 

  

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shall not operate to place responsibility upon the Secured Party for the control, care, management or repair of any property constituting security hereunder.

  
 5. Enforcement and Collection. The
Debtor will, at no cost to the Secured Party, diligently enforce and secure the performance and observance of each and every obligation, covenant, condition, and agreement of the other parties under all the Contracts. 
  
 6. Duplicate Originals. At the request of the Secured
Party, the Debtor will furnish to the Secured Party a duplicate original of each Contract now existing or hereafter executed by the Debtor. 
  
 7. Litigation. The Debtor will appear in and defend any action or proceeding at law or in equity affecting in any manner all or
part of the Collateral; and in such event the Debtor will pay all costs, charges and expenses, including cost of evidence of title and attorney’s fees incurred, and will fully indemnify the Secured Party from and against any loss, damage or
expense, including attorney’s fees, sustained or incurred by the Secured Party as a result of any failure on the part of the Debtor to comply with its obligations under this paragraph. 
  
 8. Liens. The Debtor will maintain the valid security
interest of the Secured Party in the Collateral and the sums due thereunder, free and clear of all liens, claims and encumbrances that may be, or are threatened to be, made prior to or on a parity with the security interest of the Secured Party
herein, except liens for taxes or assessments not yet payable or payable without penalty so long as payable. The Debtor will not claim any credit on interest payable on the Note or on any other payment secured hereby for any portion of the taxes
assessed against the Collateral, and the provisions of any law entitling the Debtor to such credit are hereby expressly waived by the Debtor to the extent they may be lawfully waived. The Debtor will not release any liens on its assets without at
least thirty (30) days prior written notice to the Secured Party. 
  
 9. Further Assurances. The Debtor authorizes the Secured Party to file financing statements describing the Collateral, continuation statements, amendments and any other related documents. The Debtor will assist
in the preparation of and will execute and acknowledge from time to time, alone or with the Secured Party, and deliver, file or record any further instruments, including security agreements, financing or continuation statements, mortgages or other
instruments, and do such further acts as the Secured Party requires by this Security Agreement and to subject the Collateral to the lien hereof, including all renewals, additions, substitutions, replacements or betterments thereto and all proceeds
therefrom, and otherwise to protect the same against the rights and interests of third parties, and to execute all documents and perform all acts necessary to enforce the Contracts and to make the same binding, the Debtor agreeing to pay the cost of
preparing, filing and recording the same. 
  
 10.
Acknowledgment of Debt. The Debtor, within ten (10) days after request by the Secured Party in writing, will furnish to the Secured Party, or to any proposed assignee 

  

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of this Security Agreement, a written statement duly acknowledged of the amount due under this Security Agreement and the Note and due under each Contract,
and whether any offsets, counterclaims or defenses exist against the secured debt. 
  
 11. Personal Property. The Debtor agrees: (a) to keep all Personal Property intact and in good condition, order and repair; (b) at
the Debtor’s own expense to replace any portion thereof which may be broken or become obsolete or worn out or unfit for use; (c) to comply with all laws, rules and regulations made by governmental authority and applicable thereto; (d) not to
commit or suffer any strip or waste of the Personal Property; and (e) not to alienate, assign, pledge, transfer or encumber any of the rights or interests of the Debtor therein and thereto. 
  
 12. Insurance. The Debtor will, in the name and for
the benefit of the Secured Party, during the term of this Security Agreement, keep all of the Personal Property insured against hazards of such type or types and in such amount or amounts and form of policy as the Secured Party may from time to time
require and will deposit the policies with the Secured Party. The Debtor further agrees to keep paid in advance all premiums and costs of all insurance required hereunder and, upon demand of the Secured Party, will furnish evidence of payment of
such premiums. The Debtor, not less than thirty (30) days prior to the expiration date of each policy, shall deliver to the Secured Party a renewal policy or policies, accompanied by evidence of payment satisfactory to the Secured Party. All
insurance required hereunder shall be effected under valid and enforceable policies issued by insurance companies authorized to do business in the State of Hawaii, the Debtor hereby acknowledging receipt of written notice from the Secured Party that
the Debtor is free to procure any such insurance from any insurance company so authorized. The Secured Party shall not be responsible for such insurance or for the collection of any insurance monies, or for the insolvency of any insurer of insurance
underwriter. The amount collected from any fire or other insurance policy may be applied by the Secured Party upon any indebtedness secured hereby and in such order as the Secured Party may determine, or, upon the prior written approval of the
Secured Party, the entire amount so collected, or any part thereof, may be applied to the restoration of the Personal Property, without being deemed a payment on any of the indebtedness secured hereby. Such application or restoration shall not cure
or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. No lien upon any of such policies of insurance, or upon any refund or return premium which may be payable on the cancellation or termination
thereof, shall be given to anyone other than the Secured Party, except by proper endorsement affixed to such policy and approved by the Secured Party. In the event of loss or physical damage to the Personal Property, the Debtor shall give immediate
notice thereof by mail to the Secured Party, and the Secured Party may make proof of loss if the same is not made promptly by the Debtor. In the event of foreclosure of this Security Agreement, or other transfer of title to the Collateral in the
extinguishment of the indebtedness secured hereby, all right, title and interest of the Debtor in and to any insurance policies then in force shall pass to the purchaser or the grantee. All such policies or other contracts for such insurance issued
by the respective insurers shall, to the extent obtainable, be without contribution and contain an agreement by the insurer that the policy or other contract shall 

  

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not be cancelled or materially changed without at least thirty (30) days prior written notice to the Secured Party. 
  
 13. Change in Status. The Debtor will not change its
location or place of organization or its name without at least thirty (30) days prior written notice to the Secured Party. The Debtor shall keep the Secured Party timely advised with respect to any such changes, and the Secured Party shall have no
affirmative obligation to know about any such changes. 
  
 C.
MUTUAL COVENANTS. The Debtor and the Secured Party mutually covenant and agree each with the other as follows: 
  
 1. Secured Party Not Obligated To Perform. Neither the acceptance of this Security Agreement by the Secured Party, nor the exercise
of any rights hereunder by the Secured Party, shall be construed in any way as an assumption by the Secured Party of any obligations, responsibilities or duties of the Debtor arising from the Collateral assigned hereunder or otherwise bind the
Secured Party to the performance of any of the terms and provisions contained in any of the Contracts or of any obligations respecting the Personal Property, it being expressly understood that the Secured Party shall not be obligated to perform,
observe or discharge any obligation, responsibility, duty or liability of the Debtor under any of the Collateral, including, but not limited to, appearing in or defending any action, expending any money or incurring any expenses in connection
therewith. 
  
 2. Right of Secured Party To
Defend Action Affecting Security. The Secured Party may, at the Debtors expense, appear in and defend any action or proceeding at law or in equity purporting to affect the Secured Party’s security interest under this Security Agreement.

  
 3. Right of Secured Party To Prevent or
Remedy Default. If the Debtor shall fail to perform any of the covenants, conditions and agreements required to be performed and observed by the Debtor under the Loan Documents, including this Security Agreement, the Contracts, or any other
instruments secured hereby, or in respect of the Personal Property, the Secured Party (a) may, but shall not be obligated to, take action the Secured Party deems necessary or desirable to prevent or remedy any such default by the Debtor or otherwise
to protect the security interest of the Secured Party under this Security Agreement, and (b) shall have the absolute and immediate right to enter in and upon or take possession of the Property, Collateral or any part thereof to such extent and as
often as the Secured Party, in its sole discretion, deems necessary or desirable in order to prevent or to cure any such default by the Debtor, or otherwise to protect the security of this Security Agreement. The Secured Party may advance or expend
such sums of money for the account of the Debtor, as the Secured Party in its sole discretion deems necessary for any such purpose. 
  
 4. Secured Party’s Expenses. All advances, costs, expenses, charges and attorney’s fees which the Secured Party may make,
pay or incur under any provision of this Security 

  

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Agreement for the protection of its security or for the enforcement of any of its rights hereunder, or in foreclosure proceedings commenced and subsequently
abandoned, or in any dispute or litigation in which the Secured Party or the holder of the Note may become involved by reason of or arising out of the Loan Documents, including this Security Agreement, or any other instrument secured hereby, or the
Collateral or the care and management of the Collateral, shall be paid by the Debtor to the Secured Party, upon demand, and shall bear interest until paid at the rate specified by the Note to be paid in the event of default thereunder, all of which
obligations shall be additional charges upon the Collateral and be equally secured hereby. 
  
 5. Secured Party’s Right of Set-Off. Upon the happening of any event entitling the Secured Party to pursue any remedy provided
herein, or if the Secured Party shall be served with garnishee process in which the Debtor shall be named as defendant, whether or not the Debtor shall be in default hereunder at the time, the Secured Party may, but shall not be required to, set off
any indebtedness owing by the Secured Party to the Debtor against any indebtedness secured hereby, without first resorting to the security hereunder and without prejudice to any other rights or remedies of the Secured Party or its security interest
herein. 
  
 6. No Waiver. In case the
Secured Party shall have proceeded to enforce any right or remedy hereunder and such proceedings shall have been discontinued or abandoned for any reason, then in every such case, the Debtor and the Secured Party shall be restored to their former
positions and rights hereunder with respect to the Collateral, and all rights, remedies and powers of the Secured Party shall continue as if no such proceeding had been taken. No failure or delay on the part of the Secured Party in exercising any
right, remedy or power under this Security Agreement or in giving or insisting upon strict performance by the Debtor hereunder or in giving notice hereunder shall operate as a waiver of the same or any other power or right, and no single or partial
exercise of any such power or right shall preclude any other or further exercise thereof or the exercise of any other such power or right. The Secured Party, notwithstanding any such failure, shall have the right thereafter to insist upon the strict
performance by the Debtor of any and all of the terms and provisions of this Security Agreement to be performed by the Debtor. The collection and application of proceeds, the entering and taking possession of the Collateral, and the exercise of the
rights of the Secured Party contained in the Loan Documents, including this Security Agreement, shall not cure or waive any default, or affect any notice of default or invalidate any acts done pursuant to such notice. No waiver by the Secured Party
of any breach or default of or by any party hereunder, shall be deemed to alter or affect the Secured Party’s rights hereunder with respect to any prior or subsequent defaults. 
  
 7. Remedies. No right or remedy herein reserved to the Secured Party is intended to be exclusive of
any other right or remedy, but each and every such remedy shall be cumulative and is not in lieu of but shall be in addition to any other right or remedies given under this Security Agreement. Any and all of the Secured Party’s rights and
remedies may be exercised from time to time and as often as such exercise is deemed necessary or desirable by the Secured Party. 
  

 12 

 8. Right of Secured Party To Extend Time of Payment, Substitute, Release Security,
Etc. Without affecting the liability of any person, including the Debtor, for the payment of any indebtedness secured hereby, or the lien of this Security Agreement on the Collateral, or the remainder thereof, for the full amount of any
indebtedness unpaid, the Secured Party may from time to time, without notice or without affecting or impairing any of the Secured Party’s right under this Security Agreement: (a) release any person liable for the payment of any of the
indebtedness, (b) extend the time or otherwise alter the terms of payment of any of the indebtedness or accept a renewal note or notes to evidence such an extension or alteration, (c) accept additional security therefor of any kind, including (but
not limited to) deeds of trust or mortgages, (d) alter, substitute or release from any security interest or lien held by the Secured Party any property securing the indebtedness secured hereby to its several securities therefor in such order and
manner as it may deem fit, (e) join in granting any easement or creating any restriction thereon, or (f) join in any extension, subordination or other agreement affecting this Security Agreement or the lien or charge thereof. 
  
 D. MISCELLANEOUS 
  
 1. Terms Commercially Reasonable. The terms of this
Security Agreement shall be deemed commercially reasonable within the meaning of the Uniform Commercial Code. 
  
 2. Definitions. The terms advances, costs and expenses shall include, but shall not be limited to, attorney’s fees whenever
incurred. The terms indebtedness and “obligations” shall mean and include, but shall not be limited to, all claims, demands, obligations and liabilities whatsoever, however arising, whether owing by the Debtor individually or as a partner,
or jointly or in common with any other party, and whether absolute or contingent, and whether owing by the Debtor as principal debtor or as a co-maker or as endorser, liquidated or unliquidated, and whenever contracted, accrued or payable. In this
Security Agreement, whenever the context so required, the neuter gender includes the masculine or feminine, and the singular number includes the plural and vice versa. 
  
 3. Paragraph Headings. The headings of paragraphs herein are inserted only for convenience and shall
in no way define, describe or limit the scope or intent of any provisions of this Security Agreement. 
  
 4. Change, Amendment, Etc. No change, amendment, modification, cancellation or discharge or any provision of this Security
Agreement shall be valid unless consented to in writing by the Secured Party. 
  
 5. Assignment of Secured Party’s Interest. The Secured Party shall have the right to assign its interest in this Security Agreement to any subsequent holder of the Note. 
  

 13 

 6. Parties in Interest. As and when used herein, the term Debtor shall mean and
include the Debtor and its successors and permitted assigns, and the term Secured Party shall mean and include the Secured Party herein named and its successors and assigns, and all covenants and agreements herein shall be binding upon and inure to
the benefit of the Debtor, the Secured Party and their respective successors and permitted assigns. Where there is more than one entity identified as the Debtor, the obligations of each such entity shall be joint and several. 
  
 7. Applicable Laws; Severability. This Security
Agreement shall be governed by and shall be construed and interpreted under and pursuant to the laws of the State of Hawaii. If any provision of this Security Agreement is held to be invalid or unenforceable, the validity or enforceability of the
other provisions of this Security Agreement shall remain unaffected. 
  
 8. Notices. All notices, demands or documents which are required or permitted to be given or served hereunder shall be deemed to be delivered when a record has been (a) personally delivered, (b) received by
telecopy, (c) received through the Internet, or (d) sent by registered or certified mail addressed as follows: 
  

	 	To:	HOKU SCIENTIFIC, INC. 

 2153 North King
Street, Suite 300 
 Honolulu, Hawaii 96819 
  

	 	To:	CENTRAL PACIFIC BANK 

 P. O. Box 3590

 Honolulu, Hawaii 96811-3590 
  
 Such addresses may be changed from time to time by the addressee by serving notice as provided above. Service of such notice or demand shall be deemed complete upon the
earlier of the date of actual delivery or the third day after the date of mailing if mailed in Hawaii. 
  
 9. Waiver Of Right To Jury Trial. THE DEBTOR WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF
ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, ANY RIGHTS, REMEDIES, OBLIGATIONS, OR DUTIES HEREUNDER, OR THE PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF. Except as prohibited by law, the Debtor waives any right which it may have to claim or
recover in any litigation referred to in the preceding sentence any special, exemplary, punitive or consequential damages or any damages other than, or in addition to, actual damages. 
  
 10. Terms and Conditions of This Security Agreement Supplement Other Loan Documents. The terms and
conditions of this Security Agreement applicable to the Debtor and the covenants, representations and warranties of the Debtor under this Security Agreement shall not be deemed to supersede, amend or modify the obligations and duties of the Debtor
or other parties under the Loan Agreement and the covenants, representations and warranties of the Debtor hereunder merely supplement and do not supplant or supersede provisions of similar effect or subject matter in the other Loan Documents.

  

 14 

 IN WITNESS WHEREOF, the Debtor and the Secured Party have executed these presents on the day and year
first above written. 
  

					
	 HOKU SCIENTIFIC, INC.,
a Delaware corporation

		
	 By 
	 	/s/    Dustin M. Shindo
	 	 	 Its
	 	 Chief Executive Officer and President

			
	 	 	 	 	Debtor
	
	 CENTRAL PACIFIC BANK

		
	 By
	 	/s/    Robert Kamemeto
	 	 	 Its
	 	 Senior Vice President

			
	 	 	 	 	Secured Party

  

 15Mortagage, Security Agreement and Financing Statement

 Exhibit 10.28 
  

					
	LAND COURT SYSTEM	 	 	 	REGULAR SYSTEM
	 AFTER RECORDATION, RETURN BY MAIL (    ) PICKUP (    )
	 	Total No. of Pages: 21

  

			
	 Loan No. 8100280032
	 	 
	 	 	(Tax Map Key No. (1) 9-1-075-009)

  
 MORTGAGE, SECURITY
AGREEMENT 
 AND FINANCING STATEMENT 
  

			
	Mortgagor:	  	HOKU SCIENTIFIC, INC., a Delaware corporation, whose principal place of business and post office address is 2153 North King Street, Suite 300, Honolulu, Hawaii 96819
		
	Mortgagee:	  	CENTRAL PACIFIC BANK, a Hawaii corporation, whose mailing address is P. O. Box 3590, Honolulu, Hawaii 96811-3590

  
 PROPERTY DESCRIPTION: 
  

			
	 LOT 8004, Map 645, Ld. Ct. App. No. 1069,
 Honouliuli,
District of Ewa, City and County of
 Honolulu, State of Hawaii
	 	 DOCUMENT NO.: 3182173
 TRANSFER CERTIFICATE
OF TITLE NO.: 720,871

  

 1 

 MORTGAGE, SECURITY AGREEMENT 
 AND FINANCING STATEMENT 
  
 KNOW ALL MEN BY
THESE PRESENTS: 
  
 THAT on this 9th day of June, 2005, HOKU SCIENTIFIC, INC., a Delaware corporation, whose principal place of business and post office address is
2153 North King Street, Suite 300, Honolulu, Hawaii 96819, hereinafter called the “Mortgagor”, in consideration of the sum of THREE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($3,500,000.00) loaned by CENTRAL PACIFIC BANK, a Hawaii
corporation, whose mailing address is P. O. Box 3590, Honolulu, Hawaii 96811-3590, hereinafter called the “Mortgagee”, and in order to secure the repayment thereof according to the terms of Mortgagor’s Promissory Note of even date
herewith (hereinafter called the “Note”), including any extensions, modifications or renewals thereof, and also in order to secure the repayment of any and all other indebtedness now or hereafter owing by the Mortgagor to the Mortgagee,
and also in order to secure the moneys advanced for the purpose of paying for the improvements in whole or in part described in the Loan Agreement, to secure the repayment of all subsequent loans or advances by the Mortgagee to or for the account of
the Mortgagor, pursuant to this Mortgage or the Loan Agreement, and to secure the performance and observance by the Mortgagor of the Loan Agreement and all other covenants, conditions and agreements on its part in the “Loan Documents” as
that term is defined in the Loan Agreement, does hereby grant, bargain, sell, assign, convey and mortgage unto the Mortgagee, its successors and assigns, all of that certain property more particularly described in Exhibit “A“ attached
hereto and made a part hereof. 
  
 TOGETHER WITH all right, title
and interest of the Mortgagor in and to all goods now owned or hereafter acquired which are or are to become fixtures on the premises described in Exhibit “A”, and the improvements now on or hereafter placed on such premises, and all
additions thereto, and all purchases and substitutions made to the improvements or fixtures located on the real property, and all rights, easements, tenements, privileges, hereditaments and appurtenances belonging or appertaining to the property,
and the reversions, remainders, rents, issues, profits and proceeds thereof, and all of the estate, right, title and interest of the Mortgagor, both at law and in equity, therein and thereto, and TOGETHER, ALSO, WITH all other, further or additional
title, estate or interest which may hereafter be acquired by the Mortgagor in and to the property described in Exhibit “A”. 
  
 TOGETHER, ALSO, WITH all rights of the Mortgagor to assume or reject any executory contracts relating to said property under Title 11, United States Code,
or any rules or regulations pertaining to bankruptcy or insolvency. 
  

 2 

 TO HAVE AND TO HOLD the said property unto the Mortgagee forever, as to all property owned by the
Mortgagor in fee, and for the entire unexpired term as to all property held by the Mortgagor under a lease or term of years. 
  
 And the Mortgagor hereby covenants with the Mortgagee that the Mortgagor is the lawful owner of the fee or leasehold estate hereby mortgaged, the same
being valid and in no way void or voidable, and is the owner absolutely of all personal property which may be hereby mortgaged; that the Mortgagor has good right and lawful authority to encumber or sell, assign and convey the same; that all rents,
covenants, conditions and provisions in any lease or grant of easement or other interest herein mentioned which are to be paid, observed and performed by the Mortgagor have been paid, observed and performed up to the date hereof; that the property
is free from all encumbrances excepting only such encumbrances, if any, as may be specifically described in Exhibit “A”; that the Mortgagor shall quietly enjoy and possess the same and that the Mortgagor will warrant and defend the same
unto the Mortgagee against any and all lawful claims of all persons whomsoever, excepting only claims arising out of such encumbrances, if any, as may be specifically described. 
  
 Nevertheless this conveyance is intended as a Mortgage upon the property mortgaged to secure the payment of the amounts
hereinabove mentioned, with interest thereon, and if the Mortgagor shall pay all indebtedness hereby secured, of which indebtedness the records of the Mortgagee shall be prima facie evidence, and otherwise will and faithfully perform
and observe all of the covenants, conditions and agreements herein contained and pay the cost of release hereof, and such release shall be properly executed by the Mortgagee, this Mortgage shall become void. 
  
 AND THE MORTGAGOR, for the consideration aforesaid, hereby covenants and
agrees to and with the Mortgagee as follows: 
  
 (1) To pay unto
the Mortgagee, without notice or demand being made upon it, all amounts that may be owing from time to time by Mortgagor to Mortgagee pursuant to the aforesaid Note, whether such be payments of principal or interest in lawful money of the United
States of America; 
  
 (2) To permit no waste on said premises; to
keep the mortgaged property in good condition and repair and restore and replace all improvements (now or hereafter on the premises) damaged or destroyed by any cause whatsoever; to comply with all laws, rules and regulations made by governmental
authority and applicable thereto; to keep the same free from statutory liens of every kind; to observe and perform all obligations of Mortgagor with respect to tenants or occupants of the property; and to do or to permit or suffer to be done thereto
nothing that may in any way impair or weaken the security hereby created; 
  

 3 

 (3) To pay before they become delinquent all lease rent or other charges payable by Mortgagor as to any
leasehold covered by this Mortgage, and taxes and assessments of every type or nature that may be levied, assessed or imposed upon said property or any part thereof or any interest therein, or with respect to any indebtedness secured hereby,
notwithstanding any law heretofore or hereafter enacted imposing payment of the whole or any part thereof upon the Mortgagee. Mortgagor will upon request deposit the receipts therefor with the Mortgagee, and upon any breach of this covenant or the
passage of any applicable law imposing payment of the whole or any part of any of the aforesaid taxes upon the Mortgagee and making this covenant legally inoperative or upon the rendering by any court of last resort of a decision that this covenant
is legally inoperative, then, and in any such event, all indebtedness hereby secured, without any deduction, at the option of the Mortgagee, shall become immediately due and collectible notwithstanding anything to the contrary contained in this
Mortgage, or in any note or other obligation secured hereby, or in any law hereafter enacted; 
  
 (4) To maintain or cause to be maintained commercial general liability insurance and general property damage insurance against claims for personal injury or death or property damage suffered by others occurring upon,
in or about any mortgaged property, or any elevator, escalator or hoist therein, or upon, in or about the adjoining streets and passageways thereof, and naming Mortgagee as an additional insured. All such insurance shall be in such amounts and form
as may from time to time be required by the Mortgagee and shall contain an agreement by the insurer that the insurance will not be cancelled or changed without at least thirty (30) days’ prior written notice to Mortgagee. All insurance provided
for in this paragraph or elsewhere in this instrument shall be effected under valid and enforceable policies issued by insurance companies authorized to do business in the State of Hawaii; 
  
 (5) The Mortgagor will assist in the preparation of and execute from time to
time, alone or with the Mortgagee, and authorize the filing and/or recording of any financing statements, mortgages or other instruments, and do such further acts as the Mortgagee may request to establish and maintain the lien hereof and the
perfection of the security interests of the Mortgagee in the mortgaged property, including all renewals, additions, substitutions, improvements to the same, and the proceeds thereof, and otherwise to protect the same against rights and interests of
third parties, and will pay all expenses, including reasonable attorneys’ fees, incurred by the Mortgagee, whether in litigation or otherwise, to sustain the lien or priority of this Mortgage, or to protect or enforce any of the
Mortgagee’s rights hereunder, or for any title insurance policy covering the mortgaged property, all such sums to be paid on demand, together with interest thereon at the rate then applicable under said Note, plus 3% per year from the date of
demand, all of which shall be secured hereby and be a first lien on the property subject hereto; 
  
 (6) In the event that the mortgaged property has been encumbered by any lien or mortgage prior or senior to this Mortgage, or by any lease in which
Mortgagor is the landlord or the tenant, the Mortgagor shall perform any obligation thereunder and pay any indebtedness secured by such lien or mortgage without default, shall observe and perform all of the terms, covenants or conditions of such
lease, lien or mortgage, and shall keep the Mortgagee 

  

 4 

 
indemnified against all actions, proceedings, costs (including reasonable attorneys’ fees), demands and damages which may be incurred by reason of
failure to do so. The Mortgagor further covenants with the Mortgagee not to amend any such lease, lien or mortgage without prior written consent of the Mortgagee. Mortgagor will (a) promptly notify the Mortgagee in writing of any default by the
Mortgagor in the performance or observance of any of the terms, covenants or conditions on the part of the Mortgagor to be performed or observed under any lease, or any lien or mortgage prior or senior to this Mortgage or of the occurrence of any
event which, regardless of the lapse of time, would constitute a default under the same; (b) promptly notify the Mortgagee in writing of the giving of any notice under any such lease, lien or mortgage of the default of the Mortgagor thereunder in
the performance or observance of any of the terms, covenants or conditions on the part of the Mortgagor to be performed or observed under said lease, lien, mortgage or obligation thereby secured and promptly cause a copy of each such notice to be
delivered to the Mortgagee; (c) in case any proceeds of insurance upon the property subject to such lease, lien or mortgage or any part thereof, or the proceeds of any award for the taking in eminent domain of the mortgaged property or any part
thereof, are deposited with any person other than the Mortgagee pursuant to the requirements of such lease, lien or mortgage, promptly notify the Mortgagee in writing of the name and address of the person with whom such proceeds have been deposited
and the amount so deposited; (d) promptly, after the execution and delivery of this Mortgage, notify such lessor, lienor or mortgagee in writing of the execution and delivery hereof and of the name and address of the Mortgagee and deliver a copy of
this Mortgage to such lessor, lienor or mortgagee; and (e) promptly notify the Mortgagee in writing of any request made by either party to such lease, lien or mortgage to the other party thereto for arbitration or appraisal proceedings pursuant to
such lease, lien or mortgage, and of the institution of any arbitration or appraisal proceedings, and promptly deliver to the Mortgagee a copy of the determination of the arbitrators or appraisers in each such proceeding; 
  
 (7) Mortgagor shall keep all improvements now or hereafter on said real
property and all personal property subject hereto insured against hazards of such type or types and in such amount or amounts and in such forms of insurance as may be from time to time required by the Mortgagee, including fire insurance and flood
insurance. All such policies of insurance shall (i) be carried in the name of Mortgagee and the mortgagee under any senior mortgage on the property, (ii) contain a standard mortgagee clause, and (iii) provide that the proceeds on account of any loss
shall be payable to Mortgagee (except as any senior mortgage otherwise requires). All such policies shall provide, inter alia, that the insurance shall not be cancelled without at least thirty (30) days’ prior written notice to
the Mortgagee or invalidated as to the interest of Mortgagee by any act or neglect of any person owning the property insured, or by any foreclosure or other proceedings, or by any change in the ownership of the insured properties, or by occupation
for purposes more hazardous than permitted by such policy. All policies or true copies with certificates from the insurance companies that the same are in effect shall be deposited with Mortgagee. Mortgagor shall promptly restore, replace or rebuild
any part of the improvements now or hereafter constructed or placed on the mortgaged property which may be damaged or destroyed by any casualty whatsoever, and the Mortgagor shall make up any deficiency between the cost thereof and any insurance
proceeds. All insurance proceeds received 

  

 5 

 
by or under the control of the Mortgagee on account of damage or destruction to any mortgaged property received by Mortgagee and all recoveries of any type
by Mortgagee for design or construction defects or other damages that relate to any mortgaged property, less the cost, if any, incurred by Mortgagee with respect thereto, shall, unless the Mortgagor is in default under the terms of this Mortgage, be
applied toward the payment of the cost of repairing, restoring or rebuilding the mortgaged property so damaged or destroyed according to the original plans and specifications, or such others as may be approved by the Mortgagee, on proof sufficient
to the Mortgagee that the sum requested is justly required to reimburse Mortgagor or is justly due to the contractor, materialmen, laborers, engineers, architects or other persons rendering services or materials, that the amount of such proceeds
remaining in the hands of Mortgagee will be sufficient on completion of the work to pay for the same in full, and that there has not been filed with respect to the mortgaged property any mechanics’ or other lien. Upon the completion of the work
and payment in full therefor, or upon any failure on the part of Mortgagor promptly to commence or continue the work, or if the Mortgagor is in default under any of the terms of this Mortgage, Mortgagee shall apply the amount of any such proceeds
then or thereafter in the hands of Mortgagee to the payment of any indebtedness secured by this Mortgage, whether or not then due; 
  
 (8) Mortgagor shall not cause or allow the mortgaged property to become subject to any lien, mortgage or security interest of any type, other than the
lien of this Mortgage and liens if any, described in the attached Exhibit “A”. The Mortgagor shall furnish the Mortgagee with a copy of all leases hereafter entered into by Mortgagor as lessor promptly after their execution. 
  
 AND IT IS FURTHER AGREED AS FOLLOWS: 
  
 (A) That the Mortgagee shall have the right to enter and inspect the
mortgaged property; that in the event of failure of the Mortgagor to pay, observe or perform any of the terms, covenants or conditions herein contained or contained in any lease, grant, prior or senior mortgage or other instrument referred to herein
and on the part of the Mortgagor to be observed and performed, including, without limiting the generality of the foregoing, failure to keep the mortgaged property in good condition and repair, or to pay rent, taxes and assessments before the same
become delinquent or any interest or penalty accrues thereon, or to effect said insurance and deliver the policy or policies aforesaid, or in the event there exists or shall arise at any time any claim, lien or encumbrance on said property or any
part thereof, or in the event there shall exist or arise at any time during the continuance of this Mortgage any statutory lien on said property or any part thereof, the Mortgagee may, without notice or demand and without prejudice to any other
right herein contained, perform such term, covenant or condition, including making such repairs as may seem advisable to the Mortgagee, the cost of which shall constitute an advance, or paying such rent, taxes and assessments or effecting such
insurance or payment of such claim, lien, encumbrance or statutory lien. The sum or sums so advanced shall be immediately due and payable, regardless of the validity of such taxes, assessments, insurance, claim, lien, encumbrance or statutory lien,
and shall, with interest thereon at the rate then 

  

 6 

 
applicable under said Note, plus 3% per year, from time to time of such advance, be secured hereby; 
  
 (B) If the mortgaged property or any part thereof shall be condemned, the
Mortgagee may appear and defend any such suit and is hereby irrevocably authorized to collect all of the proceeds and apply the same upon any obligation secured hereby. All costs, expenses and attorneys’ fees paid or incurred by the Mortgagee
in the course of such proceedings shall constitute an advance hereunder. 
  
 Notwithstanding any taking by eminent domain, alteration of the grade of any street or other injury to or decrease in value of the mortgaged property by any public or quasi-public authority or corporation, the
Mortgagor will continue to pay interest on the entire principal sum hereby secured until an award or payment from such authority or corporation shall have been actually received by the Mortgagee, and any reduction in the principal sum resulting from
the application by the Mortgagee of such award or payment as hereinafter set forth shall be deemed to take effect only on the date of such receipt. Any such award or payment shall be applied in such proportions and priority as the Mortgagee, in the
Mortgagee’s sole discretion, may elect, to the payment of principal and interest on the Note, whether or not then due and payable, or any sums secured by this Mortgage, or to the payment to the Mortgagor, on such terms as the Mortgagee may
specify, to be used for the sole purpose of altering, restoring or rebuilding any part of the mortgaged property which may have been altered, damaged or destroyed as a result of any such taking, alteration of grade or other injury to the mortgaged
property. If, prior to the receipt by the Mortgagee of such award or payment, the mortgaged property shall have been sold on foreclosure of this Mortgage, the Mortgagee shall have the right to receive such award or payment to the extent of the
mortgage debt remaining unsatisfied after such sale of the mortgaged property, with legal interest thereon and reasonable attorneys’ fees, costs and disbursements incurred by the Mortgagee in connection with the collection of such award or
payment. Should all or any part of the mortgaged property be taken by eminent domain, the Mortgagor hereby assigns to the Mortgagee, and forthwith upon payment thereof will cause to be deposited with the Mortgagee, the award for any mortgaged
property so taken. 
  
 In the alternative to asserting a claim to
the proceeds of condemnation, the Mortgagee may request and, if so requested, Mortgagor shall deliver substitute collateral deemed by the Mortgagee, in its sole discretion, to be the reasonable equivalent of the property described in Exhibit
“A” with respect to value, ease of sale risk and burden of administration. 
  
 (C) In the Event of Default as defined in the Loan Agreement of even date herewith or in the event of default in the repayment of amounts owing pursuant to said Note or in the payment of any other indebtedness secured
hereby, or in the repayment of any disbursement authorized by the terms of this Mortgage and actually made by any holder of the same, and such default shall continue for ten (10) days after notice thereof has been mailed to Mortgagor, or in the
performance or observance of any covenant, condition or agreement herein or in said Note contained or in the performance or observance of the terms of any other obligation owed by 

  

 7 

 
Mortgagor to Mortgagee and such default shall continue for thirty (30) days after written notice of default has been mailed to Mortgagor; or if the Mortgagor
then holding title to all or any part of the mortgaged property (or any of them, if there be more than one) shall be adjudicated a bankrupt or an insolvent or shall file or have filed against it (unless the same is dismissed within twenty (20) days
of its filing) any petition or answer seeking relief as a debtor under any law for the relief or aid of debtors or shall enter into any arrangement or composition with creditors; or if a receiver shall be appointed with respect to the property
herein described; or if the mortgaged property or any part thereof shall be seized or levied upon under any legal process or under claim of legal right; then in each such event the whole amount of all indebtedness owing by or chargeable to the
Mortgagor under any provision of this Mortgage or intended to be secured hereby shall, at the option of the Mortgagee, become at once due and payable without notice (any provision or terms thereof to the contrary notwithstanding), and any delay or
failure on the part of the Mortgagee thereto shall not comprise a waiver of that option as to that or any subsequent default by Mortgagee. In each such event, with or without foreclosure, the Mortgagee shall have the immediate right to receive and
collect all rents, income and profits from the property hereby mortgaged whether then due or accrued or to become due and said rents, income and profits are hereby assigned to the Mortgagee and said Mortgagee is hereby irrevocably appointed the
attorney-in-fact of the Mortgagor in the name of the Mortgagor, or in the name of the Mortgagee, to demand, sue for, collect, recover and receive all such rents, income and profits, to compromise and settle claims for rents, income or profits upon
such terms and conditions as to the Mortgagee may seem proper, or to enter into, renew or terminate leases or tenancies, and the Mortgagee may, in the sole discretion of the Mortgagee, foreclose this Mortgage: (a) by civil action, with the immediate
right to a receivership with the aforesaid powers upon ex parte order and without bond pending foreclosure; (b) by judicial action or power of sale, with or without entry and possession, by advertisement and sale of all or any portion
or portions of the mortgaged property, either as a whole or in parcels or units, and on such terms as to payment and credit, partial credit and security for payment as the Mortgagee may approve, having first given notice as required by law, at
public auction in Honolulu, State of Hawaii, unless at the time of such sale the law requires, notwithstanding this provision, that the sale be held elsewhere, in which event such sale shall be held wherever required by such law, and may either in
the name of the Mortgagee or as the attorney-in-fact of the Mortgagor for such purpose hereby irrevocably appointed, give valid receipts for the purchase money and effectually assign, transfer and convey the property so sold to the purchaser or
purchasers absolutely and forever; or (c) by any other remedy then provided by law. Any foreclosure shall forever bar the Mortgagor and all persons claiming under the Mortgagor from all right, title and interest in said property at law and in
equity, notwithstanding any provision of law to the contrary now existing or hereafter enacted, the Mortgagor expressly waiving the benefits thereof, and no foreclosure sale shall impair or affect the lien of this Mortgage on any portion of the
mortgaged property remaining or any other remedy of the Mortgagee for the recovery of any indebtedness remaining after application of said monies. Out of the proceeds of any foreclosure sale, the Mortgagee may deduct all costs and expenses of any
remedy pursued, including attorneys’ fees, may pay and discharge any lien, either prior or junior to this Mortgage, on said property and retain or be awarded all sums necessary to repay advances authorized hereunder and to satisfy all
indebtedness of the Mortgagor to the Mortgagee whether 
  

 8 

 
or not then due, rendering to the Mortgagor the surplus, if any, provided that, in the event that there exists any contingent liability of the Mortgagor
because of said sale, at the time of said sale, any surplus shall be retained by the Mortgagee in trust, in the estimated amount of that liability, until the liability is satisfied or terminated. If such proceeds shall be insufficient to discharge
the foregoing in full, the Mortgagee may have any other legal recourse against the Mortgagor for the deficiency as permitted by applicable law. This Mortgage shall not prevent nor be deemed to prevent the Mortgagee, in the event of default, from
pursuing any other remedy whatsoever against the Mortgagor for the collection of the indebtedness hereby secured and interest thereon and the Mortgagee may, at the option of the Mortgagee, pursue any other course to collect said indebtedness and
interest thereon and resort to any assets of the Mortgagor whatsoever without first resorting to, and without prejudice to the right to later resort to, the mortgaged property pursuant hereto; 
  
 (D) That any and all advances made by the Mortgagee to or for the account of
the Mortgagor after the date hereof, together with interest thereon, shall be secured by this Mortgage, and all of the covenants and agreements in this Mortgage contained shall apply to such further advances as well as to all other indebtedness
secured hereby, whether or not at the time such advance or advances are made there shall be then any outstanding indebtedness owing by the Mortgagor to the Mortgagee, unless a release of this Mortgage shall have been executed by the Mortgagee prior
to the time of such advance or advances; 
  
 (E) That in the event
the Mortgagee shall engage an attorney either to enforce this Mortgage, whether or not an action is commenced, or to collect the indebtedness or disbursements secured hereby, or any part thereof, whether by foreclosure of this Mortgage or otherwise
and whether or not such proceedings are subsequently abandoned, there shall become due, and the Mortgagor agrees to pay in addition to the cost and charges allowed by law, a reasonable sum as and for any attorneys’ fees and costs of collection
as an additional indebtedness hereunder, together with interest from the date those costs, charges and fees are paid by the Mortgagee, at the rate specified in Paragraph (A) above, and it is agreed that this Mortgage shall stand as security
therefor; 
  
 (F) That in the event of a sale of said property or
any part or parts thereof under and by virtue of the default provisions of this Mortgage, the purchaser or purchasers thereof shall have immediate and peaceable possession of the same and that if the Mortgagor remains in possession after the
effective date of such sale such possession shall be construed as a tenancy at sufferance only, giving unto the purchaser all remedies, by way of summary possession or otherwise, conferred by law in such case; 
  
 (G) That until any default, the Mortgagor may hold and enjoy the mortgaged
property and receive the rents, income and profits thereof; that in the event the ownership of or any interest in the mortgaged property, or any part thereof, becomes vested in a person other than the Mortgagor, the Mortgagee may, without notice to
the Mortgagor or any intervening successor, deal with a successor or successors-in-interest with reference to this Mortgage, and 

  

 9 

 
the debt hereby secured, in the same manner as with the Mortgagor without discharging or in any way affecting the liability of the Mortgagor or any successor
or successors-in-interest hereunder or upon any indebtedness hereby secured, and the Mortgagor (and each of them if there be more than one) and any successor-in-interest to the whole, or any part of the mortgaged property, hereby waive diligence,
presentment, demand and notice of dishonor and consent to extensions of time, surrender or substitution of security, failure to apply deposit or other forbearance, without notice, with respect to any indebtedness hereby secured, such waiver or
consent to be effective regardless of whether or not he, she, it or they is or are at such time the owner or owners of the mortgaged property; 
  
 (H) That on demand of the Mortgagee, the Mortgagor will pay monthly to the Mortgagee, in addition to payments of principal and interest payable under the
terms of all notes or other indebtedness secured hereby, a sum equal to the taxes, assessments, lease rentals and hazard insurance premiums next due with respect to the mortgaged property or any interest therein and required hereby to be paid by
Mortgagor (all as estimated by the Mortgagee), less all sums already paid therefor, divided, in each case, by the number of months to elapse before one month prior to the date when each such tax, assessment, rental or premium will become delinquent,
such payments to satisfy to the extent thereof the obligations hereunder of the Mortgagor with respect to such payments and such sums to be held by the Mortgagee in trust to pay said taxes, assessments, lease rentals and premiums before the same
become delinquent; it being further covenanted and agreed by the Mortgagor that, if the total of the payments made by the Mortgagor to the Mortgagee with respect to taxes, assessments, lease rentals and hazard insurance premiums shall not be
sufficient to pay all taxes, assessments, lease rentals of every kind and premiums on hazard insurance due with respect to the mortgaged property or any interest therein and required hereby to be paid by the Mortgagor when the same shall become due
and payable, then the Mortgagor shall pay any amount necessary to make up the deficiency on or before the date when the payment of such taxes, assessments, lease rentals and hazard insurance premiums shall be due; and it being further agreed that in
the event that the entire indebtedness secured hereby shall be paid in full or this Mortgage shall be foreclosed as herein provided, then, and in any such event, any balance remaining in the funds accumulated by the Mortgagee with respect to such
taxes, assessments, lease rentals and hazard insurance premiums shall be credited to the account of the Mortgagor; provided that no such demand shall be made unless this Mortgage shall be in default; 
  
 (I) That the Mortgagee or any person in behalf of the Mortgagee may be the
purchaser at any foreclosure sale, and no purchaser shall be answerable for the application of the purchase money; that the Mortgagee shall have the right to enforce one or more remedies hereunder or any other lawful remedy the Mortgagee may have,
successively or concurrently, including the right to foreclose this Mortgage with respect to any portion of the mortgaged property without thereby impairing the lien of this Mortgage on the remainder of the mortgaged property or affecting the
remedies of the Mortgagee available with respect thereto; that the Mortgagee shall have the right and is hereby expressly authorized to make application of any payments made to the Mortgagee, and any rents, income and profits collected by the
Mortgagee 

  

 10 

 
upon any indebtedness of the Mortgagor to the Mortgagee as provided herein regardless of the date thereof; that acceptance of any payment by the Mortgagee
shall not be deemed a waiver of any default of the Mortgagor then existing, except to the extent cured by such payment, nor as a waiver of any right to declare all indebtedness secured hereby at once due and payable because of any default then
existing and not cured by such payment; that as to any lease, grant of easement or other instrument referred to herein under which the Mortgagor has an estate or interest which is less than fee simple absolute, the term “mortgaged
property” and similar terms shall include such indenture of lease, grant of easement or other instrument and all extensions thereof and amendments thereto, and all of the estate, right, title and interest of the Mortgagor in and to the property
covered thereby and in and to all tenements, hereditaments, rights, easements, privileges and appurtenances belonging or in anyway appertaining to such property, and in and to all buildings, structures, fixtures and other improvements now on and all
which may hereafter be on such property; that the terms “advances”, “costs” and “expenses”, wherever herein used, shall include reasonable attorneys’ fees and recording fees whenever incurred; that the term
“indebtedness” and similar terms as used herein shall mean and include all notes, loans, advances, interest, claims, demands, obligations and liabilities whatsoever, however arising, and whether owing by the Mortgagor (or any of them if
there be more than one) individually or jointly with others, and whether absolute or contingent, liquidated or unliquidated and whenever contracted, accrued or payable; that where there is more than one Mortgagor, all obligations hereunder shall be
binding upon them jointly and severally; that where the Mortgagor is married, the execution hereof by the spouse shall bind the spouse individually and constitute a quitclaim and release to the Mortgagee of all interest of the spouse in the
mortgaged property by way of dower, curtesy, community property or otherwise and that these presents shall be equally binding upon and inure to the benefit of the heirs, personal representatives, successors and assigns of the Mortgagor and the
Mortgagee, respectively, and shall be so construed that wherever applicable with reference to any of them the use of the singular number shall include the plural number, the use of the plural number shall include the singular number, and the use of
any gender shall include either or both of the other genders; 
  
 (J) That the Mortgagor, upon request made either personally or by mail, shall certify, by a writing duly acknowledged, to the Mortgagee, or to any proposed assignee of this Mortgage, the amount of principal and interest then owing on this
Mortgage and whether any offsets or defenses exist against the Mortgage debt, within six (6) days in case the request is made personally, or within ten (10) days after the mailing of such request in case the request is made by mail; 
  
 (K) That all notices, demands or documents which are required or permitted to
be given or served hereunder shall be in writing and personally delivered or sent by registered or certified mail addressed as follows: 
  

	 	To:	HOKU SCIENTIFIC, INC. 

 2153 North King
Street, Suite 300 
 Honolulu, Hawaii 96819 
  

 11 

	 	To:	CENTRAL PACIFIC BANK 

 P. O. Box 3590

 Honolulu, Hawaii 96811-3590 
  
 Such addresses may be changed from time to time by the addressee by serving notice as provided above. Service of such notice or demand shall be deemed complete upon the
earlier of the date of actual delivery or the third day after the date of mailing if mailed in Hawaii; 
  
 (L) That in the event of the adoption or amendment, after the date of this instrument, of any law of the State of Hawaii, other than a law providing for
the imposition of a tax on, according to, or measured by income, which in any way shall change the manner of taxation or of the collection of taxes on mortgages or debts secured by mortgages to the end that directly or indirectly Mortgagee shall be
required to pay on account of this Mortgage or the indebtedness secured hereby any tax other than taxes of the kind or character now imposed by the laws of the State of Hawaii and other than a tax on, according to, or measured by income, the holder
of this Mortgage, at any time after such adoption or amendment of such law, may give written notice to Mortgagor that the said holder elects to have the indebtedness secured by this Mortgage become due and payable six (6) months from the giving of
such notice unless Mortgagor, within the said six (6) months’ period, shall agree in writing to pay the amount of such new taxes; and in the event Mortgagor, within such six (6) months’ period, so agrees to pay the amount of such new
taxes, such agreement of Mortgagor shall be deemed from the date thereof to be a covenant and obligation of Mortgagor under this Mortgage for all purposes, and in the event Mortgagor fails within said six (6) months’ period to so agree to pay
such new taxes, the indebtedness secured by this Mortgage shall become due and payable upon the last day of the six (6) months’ period. If at any time Mortgagor’s agreement to pay the amount of such new taxes shall be prohibited by law or
the payment of the same by Mortgagor would make the transaction usurious, then the indebtedness secured hereby shall become due and payable six (6) months after the giving of written notice by the holder of this Mortgage and the Note secured hereby
that it elects to have the indebtedness secured hereby become due and payable; 
  
 (M) That this Mortgage is governed by and shall be construed in accordance with the laws of the State of Hawaii; 
  
 (N) If any of the property subject to this Mortgage shall be conveyed or assigned by the Mortgagor to any other party, or if substantially all of the
property described in Exhibit “A” shall be leased for a term longer than five (5) years, or if the Mortgagor shall agree to make such lease, conveyance or assignment then, unless the Mortgagee shall in writing accept the written
undertaking of the said other party to assume and discharge all obligations of this Mortgage and discharge the Mortgagor from further liability with respect thereto, which decision shall be based solely on reasonable banking standards then in
effect, all of the indebtedness hereby secured shall at once become due and payable at the option of the Mortgagee (any 

  

 12 

 
provision or term thereof to the contrary notwithstanding), and delay or failure on the part of the Mortgagee to demand such payments shall not prejudice the
Mortgagee’s right thereto; 
  
 (O) With respect to
environmental matters which may have, which may now, or which may in the future affect Mortgagor and/or the mortgaged property, Mortgagor makes the following representations, warranties and agreements which shall survive any foreclosure of the
mortgaged property and the payoff of the indebtedness secured hereby: 
  
 (1) Environmental and Industrial Hygiene Compliance. Mortgagor represents and warrants that, as of the date of this Mortgage, the mortgaged property is not in violation of any federal, state or local law, ordinance or regulation
relating to industrial hygiene or to the environmental conditions on, under or about the mortgaged property, including, but not limited to, soil and groundwater conditions. Mortgagor further represents and warrants that, to the best of its
knowledge, no third party has used, generated, manufactured, stored or disposed of on, under or about the mortgaged property, or transported to or from the mortgaged property any flammable explosives, radioactive materials, hazardous wastes, toxic
substances or related materials (“Hazardous Materials”). Hazardous Materials shall include, but shall not be limited to, substances defined as “hazardous substances” in the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, 42 U.S.C. Sections 9601-9657; the Hazardous Materials Transportation Authorization Act of 1994, as amended, 49 U.S.C. Sections 5101 et seq.; and the Resource Conservation and Recovery Act of 1976, as amended, 42
U.S.C. Sections 6901-6992; Clean Water Act; Clear Air Act; Toxic Substances Control Act; Safety of Public Water Systems Act, as amended or modified from time to time, and any similar state or local laws, ordinances and all regulations now or
hereafter promulgated or published. 
  
 (2) Hazardous
Materials Disclosure. Mortgagor represents and warrants that, during the period of its ownership of the mortgaged property, there has been no disposal, release or threatened release of Hazardous Materials on, from or under the mortgaged
property. Mortgagor further represents and warrants that they have no knowledge of any presence, disposal, release or threatened release of any Hazardous Materials on, from or under the mortgaged property that may have occurred prior to its
acquisition of title to the mortgaged property. 
  
 (3) No
Hazardous Waste Litigation. Mortgagor represents and warrants that, during the period of its ownership of the mortgaged property, there has been no litigation or administrative enforcement actions or proceedings brought or threatened to be
brought, nor have any settlements been reached by or with any party or parties, public or private, concerning the presence, disposal, release or threatened release of any Hazardous Materials on, from or under the mortgaged property. 
  
 (4) Indemnification Related to Hazardous Materials. Mortgagor agrees
to indemnify and hold Mortgagee, its directors, officers, employees, agents and any successors, harmless from and against any and all claims, damages and liabilities arising in 

  

 13 

 
connection with the presence, use, storage, disposal or transporting of any Hazardous Materials on, under, to, from or about the mortgaged property.
Mortgagee shall have the right to join and participate in any such legal proceedings, and Mortgagor agrees to pay any attorneys’ fees and costs which may be incurred by Mortgagee. 
  
 (5) Notices Concerning Hazardous Materials Violations. Mortgagor agrees to immediately advise Mortgagee in writing of
(a) any and all enforcement, cleanup, remedial, removal or other governmental or regulatory actions instituted, completed or threatened pursuant to any applicable federal, state or local laws, ordinances or regulations relating to any Hazardous
Materials affecting the mortgaged property; and (b) all claims made or threatened by any third party against Mortgagor or the mortgaged property relating to damage, contribution, cost recovery compensation, loss or injury resulting from any
Hazardous Materials. 
  
 (P) ADA Compliance. So long as
this Mortgage remains outstanding, the Mortgagor will, at its own cost and expense, in respect of the mortgaged property and in respect of the Mortgagor’s business activities at or within the mortgaged property: (i) comply with all requirements
of the federal Americans With Disabilities Act (“ADA”), as amended from time to time, and the rules promulgated thereunder (“Rules”), to the extent applicable to the Mortgagor’s ownership, management, operation, leasing,
use, construction, reconstruction, repair, remodeling, rehabilitation or alteration of the mortgaged property, or any part thereof; (ii) immediately provide to the Mortgagee written notice (and immediately provide to the Mortgagee copies) of any and
all notices of actual, potential or alleged violations under the ADA or Rules and any and all governmental investigations or regulatory actions instituted or threatened, regarding the ADA or Rules; and (iii) furnish to the Mortgagee, from time to
time whenever reasonably requested by the Mortgagee, an ADA Compliance Assessment, in form reasonably acceptable to the Mortgagee, made by an architect or engineer having a good reputation for skill and experience in the field of ADA compliance and
otherwise reasonably acceptable to the Mortgagee. In the event that a purchaser of the mortgaged property at foreclosure or by conveyance in lieu of foreclosure incurs any compliance expenses or other expenses (including reasonable fees of legal
counsel) or liabilities as a result of the failure of the mortgaged property to comply with the requirements of the ADA and the Rules at the date of the purchaser’s acquisition thereof, the Mortgagor shall indemnify the purchaser against all
reasonable expenses and liabilities so incurred by the purchaser; and these indemnification provisions shall survive said foreclosure or conveyance in lieu of foreclosure. 
  

 14 

 IN WITNESS WHEREOF, the Mortgagor and the Mortgagee have executed these presents on the day and year
first above written. 
  

			
	 HOKU SCIENTIFIC, INC.,
a Delaware corporation

		
	By	 	 /s/ Dustin M. Shindo

	 	 	 Its Chief Executive Officer and President

		
	 	 	Mortgagor
	
	 CENTRAL PACIFIC BANK

		
	By	 	 /s/ Robert Kamemoto

	 	 	 Its Senior Vice President

		
	 	 	Mortgagee

  

 15 

					
	 STATE OF HAWAII
	  	)	  	 
	 	  	)	  	ss:
	 CITY AND COUNTY OF HONOLULU
	  	)	  	 

  
 On this 9th day of June, 2005, before me appeared Dustin M. Shindo, to me personally known, who, being by me duly sworn, did say that he
is the Chief Executive Officer and President, respectively of HOKU SCIENTIFIC, INC., a Delaware corporation, and that said instrument was signed on behalf of said corporation by authority of its Board of Directors, and said Officers acknowledged
said instrument to be the free act and deed of said corporation. 
  

	
	
	 /s/ Lori E. Kutara

	 Notary Public, State of Hawaii

	
	 My commission expires: 11-28/07

  

 16 

					
	 STATE OF HAWAII
	  	)	  	 
	 	  	)	  	ss:
	 CITY AND COUNTY OF HONOLULU
	  	)	  	 

  
 On this 9th day of June, 2005, before me appeared Robert Kamemoto, to me personally known, who, being by me duly sworn, did say that he is
a Senior Vice President of CENTRAL PACIFIC BANK, a Hawaii corporation, and that said instrument was signed on behalf of said corporation by authority of its Board of Directors, and said Officer acknowledged said instrument to be the free act and
deed of said corporation. 
  

	
	
	 /s/ Lori E. Kutara

	 Notary Public, State of Hawaii

	
	 My commission expires: 11-28/07

  

 17 

 EXHIBIT “A” 
  
 All of that certain parcel of land situate at Honouliuli, District of Ewa, City and County of Honolulu, Island of Oahu, State of Hawaii,
more particularly described as follows: 
  
 LOT 8004, area 2.283 acres, more or
less, as shown on Map 645, filed in the Office of the Assistant Registrar of the Land Court to the State of Hawaii with Land Court Application No. 1069 of the Trustees under the Will and of the Estate of James Campbell, Deceased; 
  
 Together with access across Lots 8030 and 8032, as shown on Map 645, as set forth by Land
Court Order No. 112041, filed June 4, 1993; 
  
 Together with a nonexclusive
easement over Lot 70-C-1 and 84-A-2-A, as shown on Map 229, and Lot 172-C and 424-C, as shown on Map 132, as granted by GRANT OF NONEXCLUSIVE EASEMENT (VEHICULAR ACCESS), dated December 13, 2001, filed as Land Court Document No. 2761270; and subject
to the terms and provisions, including the failure to comply with any covenants, conditions and reservations, contained therein; 
  

			
	-Note:-	  	Lot 424-C, as shown on Map 132, Lot 425-C-1, as shown on Map 373, Lots 3801-A-2 and 3801-A-3, as shown on Map 907, consolidated and resubdivided into Lots 14281, 14282, 14283, 14284 and
14285, as shown on Map 1118, as set forth by Land Court Order No. 146000, filed May 22, 2002.

  
 Being land(s) described in Transfer
Certificate of Title No. 720,871 issued to HOKU SCIENTIFIC, INC., a Hawaii corporation. 
  
 BEING THE PREMISES ACQUIRED BY KAPOLEI BUSINESS PARK II LIMITED WARRANTY DEED WITH USE RESTRICTIONS, COVENANTS AND RESERVATIONS OF RIGHTS 
  

					
			
	GRANTOR	  	:	  	KBP LAND PARTNERS, LLC, a Delaware limited liability company
			
	GRANTEE	  	:	  	HOKU SCIENTIFIC, INC., a Hawaii corporation
			
	DATED	  	:	  	October 18, 2004
	FILED	  	:	  	Land Court Document No. 3182173

  

 18 

			
	NOTE:	  	Land Court Order No. 160582, filed March 18, 2005, sets forth the merger of HOKU SCIENTIFIC, INC., a Hawaii corporation, with and into HOKU SCIENTIFIC, INC., a Delaware corporation, on
December 1, 2004.

  
 SUBJECT, HOWEVER, to the following:

  

	1.	SETBACK (25 feet wide) 

  

					
	SHOWN	  	:	  	on Map 645, as set forth by Land Court Order No. 112041, filed June 4, 1993

  

	2.	DESIGNATION OF EASEMENT “5114” 

  

					
	PURPOSE	  	:	  	electrical
	SHOWN	  	:	  	on Map 737, as set forth by Land Court Order No. 118818, filed November 28, 1994

  

	3.	The terms and provisions, including the failure to comply with any covenants, conditions and reservations, contained in the following: 

  

					
	INSTRUMENT	  	:	  	KAPOLEI BUSINESS PARK DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS
			
	DATED	  	:	  	May 28, 1993
	FILED	  	:	  	Land Court Document No. 2030298

  
 Said above
Declaration was amended by instrument dated April 22, 1994, filed as Land Court Document No. 2143431, supplemented by instruments dated November 6, 2000, filed as Land Court Document No. 2662803, dated May 3, 2004, filed as Land Court Document No.
3113276, dated May 28, 2004, filed as Land Court Document No. 3118506, dated June 3, 2004, filed as Land Court Document No. 3118507, dated June 3, 2004, filed as Land Court Document No. 3118512, and dated February 14, 2005, filed as Land Court
Document No. 3230994. 
  
 The Declarant’s interest, by mesne
assignment, was assigned to KBP LAND PARTNERS, LLC, a Delaware limited liability company, by instrument dated June 3, 2004, filed as Land Court Document No. 3118513. 
  

 19 

	4.	GRANT 

  

					
	TO	  	:	  	HAWAIIAN ELECTRIC COMPANY, INC. and GTE HAWAIIAN TELEPHONE COMPANY INCORPORATED, now known as VERIZON HAWAII INC.
			
	DATED	  	:	  	March 21, 2000
	FILED	  	:	  	Land Court Document No. 2621916
	GRANTING	  	:	  	a perpetual right and easement over said Easement “5114”

  

	5.	The terms and provisions, including the failure to comply with any covenants, conditions and reservations, contained in the following: 

  

					
	INSTRUMENT	  	:	  	TRUSTEES LIMITED WARRANTY DEED WITH USE RESTRICTIONS, COVENANTS AND RESERVATION OF RIGHTS (KAPOLEI BUSINESS PARK)
			
	DATED	  	:	  	January 2, 2002
	FILED	  	:	  	Land Court Document No. 2766591

  

	6.	The terms and provisions, including the failure to comply with any covenants, conditions and reservations, contained in the following: 

  

					
	INSTRUMENT	  	:	  	KAPOLEI BUSINESS PARK LIMITED WARRANTY DEED WITH USE RESTRICTIONS, COVENANTS AND RESERVATION OF RIGHTS
			
	DATED	  	:	  	June 3, 2004
	FILED	  	:	  	Land Court Document No. 3118515

  
 The foregoing
includes, but is not limited to, matters relating to permitted use, water rights, and reservation of drainage easements, conduits and sewer line easements. 
  

	7.	The terms and provisions, including the failure to comply with any covenants, conditions and reservations, contained in the following: 

  

					
	INSTRUMENT	  	:	  	KAPOLEI BUSINESS PARK II LIMITED WARRANTY DEED WITH USE RESTRICTIONS, COVENANTS AND RESERVATION OF RIGHTS
			
	DATED	  	:	  	October 18, 2004
	FILED	  	:	  	Land Court Document No. 3182173

  

 20 

 The foregoing includes, but is not limited to, matters relating to permitted use, water rights, and
reservation of rights. 
  
 TOGETHER, ALSO, with all of Mortgagor’s rights,
easements, privileges and appurtenances thereto belonging, and all the rents, issues, profits and proceeds thereof, and all of the estate, right, title and interest of the Mortgagor, both at law and in equity, in said property. 
  
 END OF EXHIBIT “A” 
  

 21

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