Document:

PERFORMANCE
      ACCELERATED

    RESTRICTED
      STOCK UNIT AGREEMENT

    

    ParkerVision,
      Inc. (the “Company”) has awarded to you (the “Grantee”) the following
      Performance Accelerated Restricted Stock Units (the “Award”):

    

    
      	
              Grantee
                Name

            	 	
              Number
                of Restricted Stock Units

            	 	
              Grant
                Date

            
	 	 	 	 	
              June
                4, 2008

            

    

    

    

    Each
      Restricted Stock Unit represents the obligation of the Company to deliver to
      the
      Grantee one share of the Company’s common stock, par value $0.01 per share (the
“Common Stock”), at the time provided in this Agreement, unless earlier
      terminated as provided herein. This award is granted to the Grantee pursuant
      to
      the Company’s 2000 Performance Equity Plan (the “Plan”), and is subject to the
      terms and conditions of the Plan, which terms are incorporated by reference
      in
      this Agreement as if fully set forth herein, and the terms and conditions set
      forth below. Any capitalized, but undefined, term used in this Agreement shall
      have the meaning ascribed to it in the Plan.

     

    
      	 	 	 
	 	Sincerely,
	 	 
	 	PARKERVISION, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name: Jeffrey
              Parker
	 	Title:
              Chief Executive
              Officer

    

    

    The
      Grantee hereby agrees to all the terms and conditions described in this
      Agreement and the Plan referenced herein.

    

    GRANTEE

    

    

    ______________________

    Name: 

    

    Address:

     

    ______________________

    ______________________

    ______________________

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TERMS
      AND
      CONDITIONS

    

    1. Vesting;
      Delivery of Shares of Common Stock.
      

    

    The
      Restricted Stock Units comprising the Award shall vest on the earlier
      of:

    

    (a) The
      last
      day of the three month period ending August 31, 2008 and the last day of each
      subsequent three month period (each a “Performance Period”):

    

    (i) If
      for
      any five (5) consecutive trading days on the NASDAQ Stock Market ending during
      the Performance Period, the closing price of the Company’s common stock is at
      least 45% higher than the closing price of the Company’s common stock on May 22,
      2008, then as to a number of Restricted Stock Units, if any, such that 25%
      of
      the total Award shall have vested;

    

    (ii) If
      for
      any five (5) consecutive trading days on the NASDAQ Stock Market during the
      Performance Period, the closing price of the Company’s common stock is at least
      85% higher than the closing price of the Company’s common stock on the May 22,
      2008, then as to a number of Restricted Stock Units, if any, such that 50%
      of
      the total Award shall have vested;

    

    (iii) If
      for
      any 5 (five) consecutive trading days on the NASDAQ Stock Market during the
      Performance Period, the closing price of the Company’s common stock is at least
      125% higher than the closing price of the Company’s common stock on May 22,
      2008, then as to a number of Restricted Stock Units, if any, such that 75%
      of
      the total Award shall have vested; and

    

    (iv) If
      for
      any 5 (five) consecutive trading days on the NASDAQ Stock Market during the
      Performance Period, the closing price of the Company’s common stock is at least
      160% higher than the closing price of the Company’s common stock on May 22,
      2008, then as to a number of Restricted Stock Units, if any, such that 100%
      of
      the total Award shall have vested; or

    

    (b) The
      occurrence of a “Change in Control” as defined in section 15 of the Employment
      Agreement executed in connection with this Agreement. In the event of a Change
      in Control, a “Change in Control Market Value” shall be determined as the
      greater of (i) the closing price of the Company’s common stock on the date of
      the Change in Control event, or (ii) the average per share acquisition price
      paid by the acquiring party, and 

    

    (i) If
      the
      Change in Control Market Value is at least 45% higher than the closing price
      of
      the Company’s common stock on May 22, 2008, then as to a number of Restricted
      Stock Units, if any, such that 25% of the total Award shall have
      vested;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (ii) 
      If the
      Change in Control Market Value is at least 85% higher than the closing price
      of
      the Company’s common stock on May 22, 2008, then as to a number of Restricted
      Stock Units, if any, such that 50% of the total Award shall have
      vested;

    

    (iii) If
      the
      Change in Control Market Value is at least 125% higher than the closing price
      of
      the Company’s common stock on May 22, 2008, then as to a number of Restricted
      Stock Units, if any, such that 75% of the total Award shall have vested;
      and

    

    (iv) If
      the
      Change in Control Market Value is at least 160% higher than the closing price
      of
      the Company’s common stock on May 22, 2008, then as to a number of Restricted
      Stock Units, if any, such that 100% of the total Award shall have vested;
      or

    

    (c) The
      third
      anniversary of the Grant Date, as to such number of shares, if any, such that
      the entire Award shall have vested.

    

    Within
      30
      days following the appropriate vesting date, the Company will cause to be issued
      to Grantee (or Grantee’s beneficiaries or personal representative, if Grantee is
      deceased) a number of shares of Common Stock equal to the number of Restricted
      Stock Units vesting on such date, rounded to whole shares. The shares of Common
      Stock shall be issued in certificate form or book-entry form in the records
      of
      the Company’s transfer agent.

    

    2. Termination.

    

    (a) Termination
      Due to Death or Disability.
      If
      Grantee’s employment by the Company terminates by reason of death or Disability
      (as defined in the Plan), fifty percent (50%) of any unvested portion of the
      Restricted Stock Units shall immediately vest and the remainder shall
      immediately terminate.

    

    (b) Other
      Termination.
      If
      Employee's employment is terminated for any reason other than (i) death or
      (ii)
      Disability, any unvested portion of the Restricted Stock Units shall terminate
      on the date of termination of employment.

    

    3. Additional
      Forfeiture.
      The
      Compensation Committee (the “Committee”) of the Board of Directors of the
      Company may cancel, suspend, withhold or otherwise limit or restrict the
      delivery of shares of Common Stock underlying the Restricted Stock Units
      (“Shares”) at any time if the Grantee (i) is not in compliance with all
      applicable provisions of this Agreement or the Plan or (ii) engages in any
      activity inimical, contrary or harmful to the interests of the Company,
      including, without limitation, (x) conduct related to the Grantee’s service or
      employment for which either criminal or civil penalties against the Grantee
      may
      be sought, (y) violation of any policies of the Company, including, without
      limitation, insider trading policies or anti-harassment policies or (z)
      participating in a hostile takeover attempt against the Company.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    4. Withholding
      Tax.
      Not
      later than the date as of which an amount first becomes includible in the gross
      income of the Grantee for Federal income tax purposes with respect to the Award,
      the Grantee shall pay to the Company, or make arrangements satisfactory to
      the
      Committee regarding the payment of, any Federal, state and local taxes of any
      kind required by law to be withheld or paid with respect to such amount. Tax
      withholding or payment obligations may be settled with Common Stock, including
      Common Stock that is part of the award that gives rise to the withholding
      requirement. The obligations of the Company pursuant to this Agreement and
      under
      the Plan shall be conditional upon such payment or arrangements with the Company
      and the Company shall, to the extent permitted by law, have the right to deduct
      any such taxes from any payment of any kind otherwise due to the Grantee from
      the Company. The Grantee shall give written notice to the Company of the date
      as
      of which an amount may be included in the gross income of Grantee for Federal
      income tax purposes with respect to the Award.

    

    5. Adjustments.

    

    (a) In
      the
      event of a stock split, stock dividend, combination of shares, or any other
      similar change in the Common Stock of the Company as a whole, the Board of
      Directors of the Company shall make equitable, proportionate adjustments in
      the
      number and kind of shares covered by the Restricted Stock Units.

    

    (b) In
      the
      event of any reclassification or reorganization of the outstanding shares of
      Common Stock other than a change covered by paragraph (a) of this Section 5
      or
      that solely affects the par value of such shares of Common Stock, or in the
      case
      of any merger or consolidation of the Company with or into another corporation
      (other than a consolidation or merger in which the Company is the continuing
      corporation and that does not result in any reclassification or reorganization
      of the outstanding shares of Common Stock), the Grantee shall have the right
      thereafter (until the termination or cancellation of the Restricted Stock Units)
      to receive upon the vesting of the Restricted Stock Units after such event,
      the
      amount and kind of consideration receivable by a holder of the number of shares
      of Common Stock of the Company obtainable upon vesting of the Restricted Stock
      Units immediately prior to such event. The provisions of this paragraph (b)
      of
      Section 5 shall similarly apply to successive reclassifications,
      reorganizations, mergers or consolidations, sales or other
      transfers.

    

    6. Unsecured
      Obligation; Restrictions on Transferability.
      The
      Restricted Stock Units represent an unsecured promise by the Company to issue
      shares of Common Stock to the Grantee in the future. The Grantee may not
      alienate, sell, assign, hypothecate, pledge, exchange, transfer, encumber or
      charge the Restricted Stock Units and any attempt to alienate, sell, assign,
      hypothecate, pledge, exchange, transfer, encumber or charge the same shall
      be
      void.

    

    7. [Intentionally
      omitted.]

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    8. Company
      Representations.
      The
      Company hereby represents and warrants to the Grantee that:

    

    (a) the
      Company, by appropriate and all required action, is duly authorized to enter
      into this Agreement and consummate all of the transactions contemplated
      hereunder; and 

    

    (b) the
      Shares, when issued and delivered by the Company to the Employee in accordance
      with the terms and conditions hereof, will be duly and validly issued and fully
      paid and non-assessable.

    

    9. Grantee
      Representations.
      The
      Grantee hereby represents and warrants to the Company that:

    

    (a) Grantee
      is acquiring the Restricted Stock Units and shall acquire the Shares for his
      or
      her own account and not with a view towards the distribution
      thereof;

    

    (b) Grantee
      has received a copy of all reports and documents required to be filed by the
      Company with the Securities and Exchange Commission pursuant to the Exchange
      Act
      within the last 12 months and all reports issued by the Company to its
      stockholders and the prospectus materials, if any, relating to the
      Plan;

    

    (c) Grantee
      understands that Grantee must bear the economic risk of the investment in the
      Shares, which cannot be sold by him or her unless they are registered under
      the
      Securities Act of 1933 (the “Securities Act”) or an exemption therefrom is
      available thereunder and that the Company is under no obligation to register
      the
      Shares for sale under the Securities Act;

    

    (d) in
      Grantee’s position with the Company, Grantee has had both the opportunity to ask
      questions and receive answers from the officers and other employees of the
      Company and all persons acting on its behalf concerning the terms and conditions
      of the offer made hereunder and to obtain any additional information to the
      extent the Company possesses or may possess such information or can acquire
      it
      without unreasonable effort or expense necessary to verify the accuracy of
      the
      information obtained pursuant to clause (b) above;

    

    (e) Grantee
      is aware that the Company shall place stop transfer orders with its transfer
      agent against the transfer of the Shares in the absence of registration under
      the Securities Act or an exemption therefrom;

    

    (f) Grantee
      is aware of and understands that Grantee is subject to the Insider Trading
      Policy of the Company and has received a copy of such policy as of the date
      of
      this Agreement; and

    

    (g) Grantee
      acknowledges that Grantee has been informed of the applicable provisions of
      Rule
      144 promulgated under the Securities Act, including, without limitation, its
      requirements that (i) shares must have been owned and paid for a period of
      at
      least one year before sale may occur; (ii) the Company must be at the time
      of
      sale and for a specified prior period a reporting company under the Exchange
      Act
      of 1934 and current in its filings thereunder; (iii) sale must occur in a
      customary sale through a broker; (iv) the number of shares which may be sold
      within any three month period must not exceed the volume limitations contained
      in Rule 144; and (v) prior notice of an intended sale must be fully filed with
      the Securities and Exchange Commission in the manner prescribed by law. Grantee
      realizes that, in the event Rule 144 is not available, registration under the
      Securities Act or an exemption therefrom will be required for any sale and
      the
      Company is not obligated to register any shares or to assist in obtaining an
      exemption from such registration if such exemption is otherwise available.
      Accordingly, Grantee understands that, if the terms and conditions of Rule
      144
      are not fully met, sale of the shares acquired hereby may not be readily
      possible.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    10. Securities
      Laws.

    

    (a) The
      Company shall not be obligated to issue any Common Stock pursuant to this
      Agreement if, in the opinion of counsel to the Company, the shares to be so
      issued are required to be registered or otherwise qualified under the United
      States Securities Act of 1933, as amended, or under any other applicable
      statute, regulation or ordinance affecting the sale of securities, unless and
      until such shares have been so registered or otherwise qualified.

    

    (b) Anything
      in this Agreement to the contrary notwithstanding, the Grantee hereby agrees
      that Grantee shall not sell, transfer by any means or otherwise dispose of
      the
      Shares acquired by him or her without registration under the Securities Act,
      or
      in the event that they are not so registered, unless (i) an exemption from
      the Securities Act registration requirements is available thereunder, and
      (ii) the Grantee has furnished the Company with notice of such proposed
      transfer and the Company's legal counsel, in its reasonable opinion, shall
      deem
      such proposed transfer to be so exempt.

    

    11. Miscellaneous.

    

    (a) Notice.
      Any
      notice or other communication required or permitted to be delivered to any
      party
      under this Agreement shall be in writing and shall be deemed properly delivered,
      given and received when delivered (by hand, by certified or registered mail
      (return receipt requested, postage prepaid) or by courier or express delivery
      service) to the Company at its principal executive office and to the Grantee
      at
      his address set forth above, or to such other address as either party shall
      have
      specified by notice in writing to the other.

    

    (b) Conflicts
      with the Plan.
      In the
      event of a conflict between the provisions of the Plan and the provisions of
      this Agreement, the provisions of the Plan shall in all respects be
      controlling.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (c) Interpretations
      Binding.
      Plan
      Administrator interpretations and determinations are binding and
      conclusive.

    

    (d) No
      Rights of Stockholder.
      The
      Grantee shall not have any stockholder rights, such as rights to vote or to
      receive dividends or other distributions, with respect to any Restricted Stock
      Units held by the Grantee.

    

    (e) No
      Right to Continued Employment.
      Nothing
      in the Plan or in this Agreement shall confer on the Grantee any right to
      continue in the employ of, or other relationship with, the Company (or with
      any
      parent, subsidiary or affiliate of the Company) or limit in any way the right
      of
      the Company (or of any parent, subsidiary or affiliate of the Company) to
      terminate the Grantee’s employment or other relationship with the Company (or
      with any parent, subsidiary or affiliate of the Company) at any time, with
      or
      without cause.

    

    (f) No
      Right to Further Grants.
      Restricted Stock Unit grants are within the discretion of the Board of
      Directors, or a Committee designated by the Board of Directors, and no such
      grant entitles the Grantee to any further grants.

    

    (g) Waiver.
      The
      waiver by any party hereto of a breach of any provision of this Agreement shall
      not operate or be construed as a waiver of any other or subsequent
      breach.

    

    (h) Entire
      Agreement.
      This
      Agreement constitutes the entire agreement between the parties with respect
      to
      the subject matter hereof. This Agreement may not be amended except in writing
      executed by the Grantee and the Company.

    

    (i) Binding
      Effect; Successors.
      This
      Agreement shall inure to the benefit of and be binding upon the parties hereto
      and, to the extent not prohibited herein, their respective heirs, successors,
      assigns and representatives. Nothing in this Agreement, expressed or implied,
      is
      intended to confer on any person other than the parties hereto and as provided
      above, their respective heirs, successors, assigns and representatives, any
      rights, remedies, obligations or liabilities.

    

    (j) Choice
      of Law.
      This
      Agreement shall be governed by and construed and interpreted in accordance
      with
      the substantive laws of the State of Florida, without giving effect to any
      conflicts of law rule or principle that might require the application of the
      laws of another jurisdiction.

    

    (k) Headings.
      The
      headings contained herein are for the sole purpose of convenience of reference
      and shall not in any way limit or affect the meaning or interpretation of any
      of
      the terms or provisions of this Agreement.

    

    (l) Section
      409A.
      This
      Agreement is intended to comply with the provisions of Section 409A of the
      Internal Revenue Code of 1986, as amended (“Section 409A”). To the extent that
      the Restricted Stock Units or any payments or benefits provided hereunder are
      not considered compliant with Section 409A, the parties agree that the Company
      shall take all actions necessary to cause such payments and/or benefits to
      become compliant.Exhibit
      10.68

     

    [*]
      = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
      BRACKETS, HAS BEEN OMITTED FROM PUBLIC FILING PURSUANT TO A REQUEST FOR
      CONFIDENTIAL TREATMENT SUBMITTED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION.
      THE OMITTED INFORMATION, WHICH HAS BEEN IDENTIFIED WITH THE SYMBOL “[*],” HAS
      BEEN FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION PURSUANT
      TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
      AMENDED.

     

    EQUIPMENT
      PURCHASE & SALE AGREEMENT

     

    This
      Equipment Purchase & Sale Agreement (this “Agreement”),
      entered into as of March 4, 2008 (the “Effective
      Date”),
      by
      and between SAFT POWER SYSTEMS USA INC., a Delaware corporation, having its
      principal place of business at 800 Klein Road, Suite 400, Plano, Texas 75074
      (hereinafter “SELLER”),
      and
      HOKU MATERIALS, INC., a corporation organized and existing under the laws of
      the
      State of Delaware, having its principal place of business at One Hoku Way,
      Pocatello, Idaho 83204 (hereinafter “BUYER”).
      SELLER
      and BUYER are each a “Party”
and
      together, the “Parties.”

     

    Recitals

     

    WHEREAS,
      SELLER is a manufacturer and provider of equipment and related services for
      the
      polycrystalline silicon industry; 

     

    WHEREAS,
      BUYER is building a manufacturing facility for the production of polycrystalline
      silicon in Idaho, USA; and

     

    WHEREAS,
      subject to the terms and conditions set forth in this Agreement, BUYER intends
      to purchase from SELLER and SELLER intends to sell to BUYER, the equipment
      and
      other Deliverables (as defined below) for use in BUYER’s polycrystalline silicon
      production plant; 

     

    NOW,
      THEREFORE, pursuant to the terms and conditions and the mutual consideration
      set
      forth herein, and for other good and valuable consideration, the receipt and
      sufficiency of which are acknowledged hereby, BUYER and SELLER agree as
      follows:

     

    Agreement

     

    1. Definitions.
      The
      following capitalized terms used in this Agreement shall have the meanings
      set
      forth below: 

     

    1.1. “Certificate
      of Commissioning”
      shall mean the certificate, in substantially the form of Appendix
      8attached
      to this Agreement, to be signed by an officer of BUYER and an officer of SELLER
      after the successful completion of the Commissioning Test.

     

    1.2. “Commissioning
      Test”
      shall mean the test to be completed by SELLER in the presence of BUYER
      at the Work Site that follows the procedures described in Appendix
      6
      to
      confirm that all Equipment meets the Technical Specifications.

     

    1.3. “Deliverables”
      shall mean, collectively, all Equipment, Technical Documentation and
      Technical Services to be provided by SELLER to BUYER pursuant to this
      Agreement.

     

    1.4. “Equipment”
      shall mean the following items of equipment as more fully described
      in
Appendix
      1:

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          1 of
          30

        
          

        

      

      
        
        

      

    

     

    

      Item
        1: [*]
        Thyroboxes VSC for reactors as described in Appendix
        1
        (each, a
“Reactor”),
        priced at [*] per each Reactor (the “Reactor
        Unit Price”),
        for
        an aggregate purchase price of [*] for all of the [*] Reactors.

       

      Item
        2:
        [*] earth fault detection systems as described on Appendix 1 (each, an
“Earth
        Fault Detection System”)
        priced
        at [*] per each Earth Fault Detection System, for an aggregate purchase price
        of
        [*] for all of the [*] Earth Fault Detection Systems.

       

      Item
        3:
        [*] year spare parts, which shall include those parts listed on Appendix
        1 (the
“Spare Parts”). The aggregate purchase price for the Spare Parts is
        [*].

       

      Item
        4:
        Seaworthy Packing of all Equipment, for an aggregate purchase price of
        [*].

       

      1.5. “Factory
        Acceptance Certificate”
shall
        mean the certificate, in substantially the form of Appendix
        6
        attached
        to this Agreement, to be signed by an officer of BUYER and an officer of
        SELLER
        after the successful completion of the Factory Acceptance Test. 

       

      1.6. “Factory
        Acceptance Test”
shall
        mean the test to be completed by SELLER in the presence of BUYER at the SELLER
        Facility that follows the procedures described in Appendix
        4
        to
        confirm that all Equipment meets the Technical Specifications.

       

      1.7. “Port
        of Shipment”
shall
        mean Hamburg, Germany. 

       

      1.8. “Port
        of Unloading”
shall
        mean a port to be designated by BUYER in the USA.

       

      1.9. “SELLER
        Facility”
shall
        mean the facility where SELLER is manufacturing the Equipment, located at
        Belecke, Germany. 

       

      1.10. “Technical
        Documentation”
shall
        mean the documentation (in English language) that includes the technical
        data,
        specifications, drawings, inspection, erection, commissioning, performance
        testing, operating and maintenance of Equipment, as specified in Appendix
        3.

       

      1.11. “Technical
        Services”
shall
        have the meaning set forth in Section 5.5
        below.

       

      1.12. “Technical
        Specifications”
means
        the operating and other specifications of the Equipment set forth on
Appendices
        1 and 2
        attached
        hereto.

       

      1.13. “Warranty
        Period”
shall
        mean the period beginning on the Effective Date and ending on the earlier
        of (A)
        twelve (12) months after the Certificate of Commissioning has been signed
        by
        BUYER and SELLER, and (B) eighteen (18) months after the applicable Shipment
        Date. 

       

      1.14. “Work
        Site”
shall
        mean the BUYER’s polysilicon plant located in Pocatello, Idaho USA.

       

      2. Purchase
        & Sale Commitment

       

      2.1. Subject
        to the terms and conditions set forth herein, BUYER agrees to buy from SELLER,
        and SELLER agrees to sell to BUYER, the Deliverables.

       

      3. Payment
        Terms

       

      3.1. BUYER
        shall pay to SELLER an aggregate of Thirteen Million One Hundred Eighteen
        Thousand Six Hundred Forty and 00/100 U.S. Dollars ($13,118,640.00) as the
        total
        payment for all Deliverables under this Agreement, excluding SELLER’s
        Commissioning expenses that will be paid separately
        pursuant to Section 5.5
        below,
        (the “Agreement
        Price”)
        in
        accordance with the following schedule:

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          2 of
          30

        
          

        

      

      
        
        

      

    

     

    3.1.1. Within
      Thirty (30) days after invoicing from Accepted Purchase Order Date, BUYER shall
      pay to SELLER ten percent (10%) of the Agreement Price (the “Initial
      Payment”).
      

     

    3.1.2. Within
      Thirty (30) days after invoicing on the two-month anniversary of the Effective
      Date, and provided that this Agreement has not been terminated or cancelled
      by
      BUYER pursuant to Section 3.2
      below,
      or terminated by BUYER or SELLER pursuant to Section 9
      below,
      and
      subject to receipt by BUYER of a progress report from SELLER describing in
      reasonable detail the progress that is being made in the construction and
      delivery of the Equipment, and provided that SELLER certifies to BUYER that
      it
      is on-track to meet the delivery schedule set forth in Section 4.1
      below,
      BUYER shall pay to SELLER ten percent (10%) of the Agreement Price as a progress
      payment (the “Second Payment”).

     

    3.1.3. Within
      Thirty (30) days after invoicing on the three-month anniversary of the Effective
      Date, and provided that this Agreement has not been terminated or cancelled
      by
      BUYER pursuant to Section 3.2
      below,
      or terminated by BUYER or SELLER pursuant to Section 9
      below,
      and
      subject to receipt by BUYER of a progress report from SELLER describing in
      reasonable detail the progress that is being made in the construction of the
      Equipment, and provided that SELLER certifies to BUYER that it is on-track
      to
      meet the delivery schedule set forth in Section 4.1
      below,
      BUYER shall pay to SELLER fifteen percent (15%) of the Agreement Price as a
      second progress payment (the “Third
      Payment”).

     

    3.1.4. Within
      the earlier of (A) thirty (30) days after BUYER and SELLER sign the Factory
      Acceptance Certificate for each article of Equipment, or (B) thirty (30) days
      after the date notified to the BUYER for the Factory Acceptance Test for each
      article of Equipment, and receipt by BUYER of a Factory Acceptance Certificate
      that is signed by SELLER, if the BUYER does not come to SELLER’s premises on the
      notified date for the Factory Acceptance Test, and upon receipt of an invoice
      from SELLER, and provided that this Agreement has not been terminated by BUYER
      or SELLER pursuant to Section 9
      below,
      BUYER
      shall pay to SELLER Sixty percent (60%) of the Agreement Price, minus any
      liquidated damages that are owing to BUYER for late delivery pursuant to Section
      4.4
      (the
“FAT
      Payment”).
      BUYER
      acknowledges and agrees that SELLER shall have no obligation to ship the
      Deliverables until BUYER pays in full the amount in the previous sentence.
      

     

    3.1.5. On
      or
      before the earlier of (A) twelve (12) months after the successful completion
      of
      the Commissioning Test (as defined below) for the Equipment, or (B) eighteen
      (18) months after shipment of the Equipment, BUYER shall pay to SELLER five
      percent (5%) of the Agreement Price, Net 30 Days. 

    
       

      3.2. Notwithstanding
        anything to the contrary in this Agreement, BUYER may terminate this Agreement
        at any time prior to making the Second
        Payment, and shall thereupon have no liability or further obligation to SELLER
        pursuant to this Agreement.
        In case
        of termination by the BUYER under this Article 3.2, SELLER shall be entitled
        to
        retain the Initial Payment as liquidated damages in full and final settlement
        of
        all claims with the BUYER. 

       

      3.3. The
        Agreement Price includes all excise, sales, use, import, export or other
        similar
        taxes (collectively “Taxes”)
        levied
        by any government authority. 

       

      3.4. SELLER
        shall provide BUYER with five (5) copies of each invoice for the applicable
        payment pursuant to Section 3.1
        above.
        Shipping costs and expenses, Taxes, customs and duties, if any, will be
        identified as separate items on SELLER’s invoices. All invoices shall be sent to
        BUYER’s address specified
        in Section 13.4
        below,
        unless an alternate address is provided. All payments shall be made in U.S.
        Dollars. 

    

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
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      3.5. Buyer
        shall have the option during the term of this Agreement to purchase insurance
        for the shipping of the equipment, in the amount of One Hundred Thirty One
        Thousand Six Hunded U.S. Dollars ($131,600.00), which shall be paid in pro
        rata
        increments upon each shipment of the Equipment to the Work Site. 

       

      3.6. All
        payments to SELLER shall be effected by wire transfer to SELLER’s bank pursuant
        to the following account information: 

       

      Bank
        of
        America

      111
        North
        Plano Road, Richardson, Texas

      ACH
        Routing # 111000025

      Bank
        Account # 004798681520

       

      4. Shipment;
        Documentation & Packing.

       

      4.1. Timing
        of Shipment.
        Provided that BUYER has made all payments required to have been made to SELLER
        pursuant to Section 3.1
        above,
        the Equipment shall be delivered Ex Works SELLER’s factory, according to the
        following schedule, with each scheduled shipping date being referred to herein
        as a “Shipment
        Date”.

       

      
        	
                Shipment
                  Date

              	 	
                Units

              	 
	
                September
                  1, 2008

              	 	 	
                1-2

              	 
	
                October
                  1, 2008

              	 	 	
                3-7

              	 
	
                November
                  1, 2008

              	 	 	
                8-12

              	 
	
                December
                  1, 2008

              	 	 	
                13-17

              	 
	
                January
                  1, 2009

              	 	 	
                18-22

              	 
	
                February
                  1, 2009

              	 	 	
                23-28

              	 

      

       

      Notwithstanding
        the foregoing scheduled Shipment Dates, SELLER shall work with BUYER to expedite
        delivery and accelerate each Shipment Date to the extent possible. 

       

      4.2. Shipping
        Documentation.
        Prior
        to shipment, SELLER shall remit to BUYER the following
        documentation:

       

      4.2.1. At
        least
        fourteen (14) days prior to shipment of the Equipment, SELLER shall notify
        BUYER
        by Fax of the following information:

       

      
        	 	
                (a)

              	
                Total
                  volume

              

      

      
        	 	
                (b)

              	
                Total
                  gross weight of packages

              

      

      
        	 	
                (c)

              	
                Total
                  number of packages

              

      

      
        	 	
                (d)

              	
                Port
                  of Shipment

              

      

      
        	 	
                (e)

              	
                Port
                  of Unloading

              

      

      
        	 	
                (f)

              	
                Name,
                  weight, IMCO No. (as per International Maritime Dangerous Goods
                  Code) of
                  the dangerous and/or inflammable
                  goods

              

      

       

      4.2.2. At
        least
        fourteen (14) days prior to shipment of the Equipment, SELLER shall send
        to
        BUYER via international courier at least six (6) copies of the
        following:

    

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
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                (a)

              	
                Detailed
                  packing list describing with specificity all Equipment included
                  with the
                  applicable shipment, including Equipment specification, type, quantity,
                  unit/total price, unit weight, unit/total volume, the overall dimensions
                  of each package (length x width x height), and the total number
                  of
                  packages

              

      

      
        	 	
                (b)

              	
                Description
                  of any dangerous and/or inflammable goods indicating names, properties,
                  special protective measures and handling methods in case of
                  accident

              

      

      
        	 	
                (c)

              	
                Description
                  of the special precautions for the Equipment that requires special
                  storage
                  and transportation.

              

      

       

      4.3. Risk
        of Loss.
        Title
        and risk of loss shall pass to BUYER Ex Works SELLER’s factory. 

       

      4.4. Penalties
        for Late Delivery; Liquidated Damages.
        SELLER
        shall pay to BUYER liquidated damages (the “Liquidated
        Damages”)
        if the
        Equipment has not been delivered Ex Works SELLER’s factory on or before the
        Shipment Date. The Liquidated Damages shall be calculated as
        follows:

       

      
        	 	
                a)

              	
                If
                  the Equipment is delivered within two weeks after the Shipment
                  Date, the
                  liquidated damages shall be one percent (1.0%) of the Agreement
                  Price per
                  week beyond the Shipment Date.

              

      

      
        	 	
                b)

              	
                If
                  the Equipment is delivered after the second week, then, in addition
                  to the
                  Liquidated Damages pursuant to sub-paragraph (a) above, the Liquidated
                  Damages shall be two percent (2%) of the Agreement Price for each
                  week
                  after the second week from the Shipment
                  Date.

              

      

      
        	 	
                c)

              	
                Less
                  than one week shall not be counted as a complete week for calculation
                  of
                  the Liquidated Damages.

              

      

      
        	 	
                d)

              	
                The
                  total amount of the Liquidated Damages shall not exceed ten percent
                  (10%)
                  of the Agreement Price.

              

      

      

      Notwithstanding
        anything to the contrary in this Agreement: (A) the payment of Liquidated
        Damages shall not release SELLER from its obligation to deliver the
        Deliverables; and (B) any delay beyond sixty (60) days from the Shipment
        Date
        shall constitute a material breach of this Agreement by SELLER.

       

      4.5. Packing
        and Marking

       

      4.5.1. Unless
        otherwise specified in the Agreement, the Equipment shall be packed by SELLER
        in
        new wooden cases, and all packing expenses shall be for SELLER’s account.
        Necessary measures shall be taken to protect the Equipment from damages caused
        by moisture, rain, rust, corrosion, and, shock and to ensure the Equipment
        will
        withstand handling, loading and unloading as well as long distance ocean
        and
        inland transportation for the safe arrival of the Equipment at the Work
        Site.

       

      4.5.2. The
        loose
        accessories in all packages and bundles shall be labeled by SELLER indicating
        the name of the Equipment to which such accessories are related, the name
        of the
        accessories and their position number, and any accessory number marked on
        assembly drawings. Spare parts and tools shall be marked with the word “Spare
        parts or tools” in addition to the above mentioned particulars.

       

      4.5.3. SELLER
        shall, on four (4) adjacent sides of each crate, conspicuously mark the
        following information in English with indelible paint:

       

      
        	 	
                (a)

              	
                Shipping
                  mark

              

      

      
        	 	
                (b)

              	
                Destination

              

      

      
        	 	
                (c)

              	
                Consignee

              

      

      
        	 	
                (d)

              	
                Name
                  of Equipment and item No.

              

      

      
        	
              	(e)	
                Case/bale
                  No.

              

      

    

      

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
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                (f)

              	
                Gross/net
                  weight

              

      

      
        	 	
                (g)

              	
                Measurement

              

      

       

      4.5.4. Should
        the Equipment weigh more than 2 metric tons, the weight, gravity and hoisting
        positions shall be marked in English with international trade transportation
        marks on the four adjacent sides on each case so as to facilitate unloading
        and
        handling. In accordance with different requirements in loading, unloading
        and
        shipping, the package shall be conspicuously marked with “Handle with care,
        right side up, keep dry” in English and with appropriate international trade
        marks.

       

      4.5.5. The
        following documents shall be enclosed in each package of the
        Equipment:

       

      
        	 	
                (a)

              	
                Two
                  (2) duplicate copies of detailed packing
                  list

              

      

      
        	 	
                (b)

              	
                Two
                  (2) duplicate copies of quality
                  certificate

              

      

      
        	 	
                (c)

              	
                Two
                  duplicate copies of Technical Documentation for relevant
                  Equipment

              

      

       

      4.5.6. Sufficient
        shores or chocks shall be provided in order to prevent the Equipment from
        moving
        inside the containers. SELLER shall be liable for any damage to the Equipment
        thus incurred due to the negligence of SELLER.

       

      4.5.7. .If
        the
        Equipment is damaged or lost due to improper packing or inadequate protective
        measure, SELLER shall be responsible for repair, replacement or compensation
        in
        accordance with the Agreement. If the Equipment is mis-transported due to
        mistake or ambiguousness in package or shipping marks, SELLER shall bear
        additional expenses thus incurred.

       

      5. Standards
        & Inspections

       

      5.1. Standards.
        SELLER
        shall engineer, design and construct the Equipment according to the Appendices
        attached hereto, using professional engineering, construction and procurement
        practices. All Equipment shall be engineered and constructed to meet IEC
        62103
        (EN 50178) applicable standards.

       

      5.2. Factory
        Acceptance Test.
        

       

      5.2.1. SELLER
        shall inspect the Equipment to confirm that it meets the Technical
        Specifications, and shall thereupon send the ex-works quality certificate
        to
        BUYER, with notification of the planned date for the Factory Acceptance Test.
        The date for the Factory Acceptance Test must be no earlier than two (2)
        weeks
        from the date when the notification is received by BUYER.

       

      5.2.2. BUYER
        will send its technical representatives and inspectors to SELLER’s Facility to
        complete the Factory Acceptance Test together with SELLER’s technical
        representatives and inspectors. In addition to BUYER’s inspectors, BUYER’s
        lenders and shareholders may also send their inspectors. The expenses of
        sending
        BUYER’s inspectors, or the inspectors of BUYER’s lenders and shareholders, shall
        be for BUYER’s account. 

       

      5.2.3. Prior
        to
        commencement of the Factory Acceptance Test, SELLER shall provide BUYER with
        technical instruction in the operation and maintenance of the Equipment as
        described in Appendix
        2.
        After
        completing the technical instruction, SELLER shall commence the Factory
        Acceptance Test, and provided that the Equipment meets the Technical
        Specifications, BUYER and SELLER shall sign the Factory Acceptance Certificate.
        SELLER shall ship the Equipment to BUYER as soon as practicable after successful
        completion of the Factory Acceptance Test, as evidenced by the Factory
        Acceptance Certificate signed by SELLER and BUYER; provided, however, that
        the
        SELLER may not ship the Equipment until the Factory Acceptance Certificate
        has
        been signed by BUYER. 

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
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      5.2.4. In
        addition to the foregoing, BUYER, its authorized representatives and its
        lenders, shareholders and their respective authorized representatives, may
        inspect the Equipment at any time prior to delivery of the Equipment FOB
        to the
        Port of Shipment. The expenses of any such inspection shall be for BUYER’s
        account. 

       

      5.2.5. The
        Factory Acceptance Test shall not be a substitute for the inspection of the
        Equipment at the Port of Unloading or the Work Site, or as a substitute for
        the
        Commissioning Test, and the Factory Acceptance Test shall not release SELLER
        from its warranty obligations as further specified in this
        Agreement.

       

      5.3. Installation
        and Commissioning Test.

       

      5.3.1. Equipment
        installation and servicing shall be carried out by BUYER under the supervision
        of SELLER at the Work Site, and SELLER’s qualified technical representatives
        shall provide technical instruction to BUYER during installation and prior
        to
        completion of the Commissioning Test as described in Appendix
        4
        to this
        Agreement (the “Commissioning”).
        SELLER acknowledges that BUYER intends to commission each Reactor on a rolling
        basis as they are delivered, which may require more than one visit to Work
        Site
        for Commissioning.

       

      5.3.2. BUYER
        and
        SELLER shall conduct the Commissioning Test for each unit of Equipment to
        confirm that the Equipment operates in accordance with the Technical
        Specifications. Provided that all of the Technical Specifications for each
        unit
        of Equipment is satisfied, BUYER and SELLER shall each sign the Certificate
        of
        Commissioning for such unit of Equipment.

       

      5.4. Notwithstanding
        anything to the contrary in this Agreement, BUYER’s execution of the Factory
        Acceptance Certificate or the Certificate of Commissioning shall not release
        SELLER from its warranty for the Equipment as described in Section 6
        below.

       

      5.5. Technical
        Services.
        SELLER
        agrees to provide technical information regarding the Equipment to BUYER,
        and to
        BUYER’s designated engineering and construction contractors (the “Contractors”),
        and
        to attend meetings in the USA with the Contractors, participate in telephone
        conference calls with BUYER and the Contractors, and draft and respond to
        written correspondence, including e-mail to and from BUYER and the Contractors,
        and to provide Commissioning services at the Work Site when reasonably directed
        by BUYER (collectively, the “Technical Services”).
        The
        scope of the technical information to be provided to the Contractors shall
        be
        limited to the information that is required for the Contractors to perform
        the
        engineering design work for the Work Site. BUYER will pay SELLER One Thousand
        Two Hundred Dollars (Dollars 1,200) per person and per eight-hour working
        day
        that SELLER’s personnel are at the Work Site or at any Contractor’s site to
        perform Technical Services at the express direction of BUYER, and BUYER shall
        reimburse SELLER for all reasonable and pre-approved out-of-pocket travel
        expenses incurred at the request of BUYER to perform the Technical
        Services.

       

      6. Representations
        and Warranties. 

       

      6.1. General.
        SELLER
        represents, warrants, and covenants that: 

       

      6.1.1. SELLER
        will not, in the course of performing its obligations under this Agreement,
        infringe or misappropriate, and neither the Deliverables nor any element
        thereof
        will infringe or misappropriate, any intellectual property right of any other
        person or entity;

      
        	
                SELLER
                  Initials & Date KM
                  March 4, 2008

              	
                BUYER
                  Initials & Date DS
                  March 19, 2008

              

      

    

    
      
        
        

      

      
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      6.1.2. neither
        the Deliverables nor any element thereof will be subject to any restriction,
        mortgage, lien, claim, pledge, security interest, or encumbrance when delivered
        by SELLER to BUYER FOB Port of Shipment;

       

      6.1.3. SELLER
        will not grant, directly or indirectly, any right or interest in the
        Deliverables to any other person;

       

      6.1.4. SELLER
        has full right, power, and authority to enter into and perform this Agreement
        without the consent of any third party, including the right to grant all
        licenses granted by SELLER (if any) in this Agreement;

       

      6.1.5. All
        individuals who contribute to or participate in the conception, creation,
        or
        development of the Deliverables will have unconditionally and irrevocably
        assigned all of their right, title, and interest in and to the Deliverables
        (and
        all intellectual property rights thereto) to SELLER (or directly to BUYER)
        before being allowed to begin performing work pursuant to this
        Agreement;

       

      6.1.6. SELLER
        will comply with all laws, regulations, and ordinances applicable to SELLER’s
        performance of its obligations under this Agreement, including export control
        laws, and has obtained (or before performing its obligations under this
        Agreement will obtain) all governmental permits and licenses required for
        SELLER
        to perform its obligations under this Agreement; and

       

      6.1.7. SELLER
        will take all necessary or reasonable precautions to prevent injury to any
        person (including BUYER employees) or damage to any property (including BUYER
        property) during the term of this Agreement.

       

      6.2. Performance.
        SELLER
        further represents and warrants that: (A) during the Warranty Period, the
        Deliverables will fully conform to the requirements, and other terms in the
        Appendices and elsewhere in this Agreement, including, without limitation,
        the
        Technical Specifications; (B) the Technical Documentation shall be complete,
        clear and correct so as to meet the requirements of design, inspection,
        erection, commissioning, performance test, operation and maintenance of the
        Equipment; and (C) the Equipment shall be completely brand new and comply
        in
        materials, workmanship in all respects with the quality and Technical
        Specifications. 

       

      6.3. Warranty
        Claims. 

       

      6.3.1. Notice
        of Claim.
        Claims
        by BUYER for breach of any of SELLER’s warranties set forth in this Agreement
        shall be made as soon as reasonably practicable after the discovery thereof,
        and
        in any event, the earlier of (A) 90 days after discovery; and (B) 90 days
        after
        the expiration of the Warranty Period. 

       

      6.3.2. SELLER’s
        Responsibilities.
        In the
        event of SELLER’s breach of any warranty during the Warranty Period, without
        limiting any other rights or remedies BUYER may have, and provided that BUYER
        has provided notice pursuant to Section 6.3.1
        above,
        SELLER will promptly repair or replace the Deliverables at no additional
        charge
        to BUYER. In the event that the warranty claim applies to Equipment, BUYER
        and
        SELLER shall attempt to fix the problem through BUYER’s remote technical
        assistance; provided, however, that if the Equipment cannot be fixed within
        48
        hours, then SELLER shall dispatch qualified technical representatives to
        the
        Work Site within 72 hours thereafter to provide on-site professional and
        technical service. IF
        SELLER DOES NOT ARRIVE AT BUYER’S WORK SITE WITHIN 72 HOURS AFTER CONFIRMATION
        FROM SELLER OF SUCH A NOTIFICATION, THEN SELLER SHALL PAY BUYER $1,000 PER
        DAY
        FOR EACH DAY THAT THE EQUIPMENT IS NOT OPERATIONAL DUE TO THE BREACH OF
        WARRANTY. 

    

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    

    
      
        
        

      

      
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      7. Indemnification.
        Each Party will indemnify and hold harmless the other Party and its affiliates,
        employees, and agents from and against any and all liabilities, losses, damages,
        costs, and other expenses (including reasonable attorneys’ and expert witnesses’
costs and fees) arising from or relating to any breach of any representation,
        warranty, covenant, or obligation of the said Party in this Agreement or
        any
        intentional misconduct or negligence by the said Party or any of the said
        Party’s agents or subcontractors in performing its obligations under this
        Agreement. In the event of any third-party claim, demand, suit, or action
        (a
“Claim”)
        for
        which a Party (or any of its affiliates, employees, or agents) is or may
        be
        entitled to indemnification hereunder, the Party may, at its option, require
        the
        breaching Party to defend such Claim at the breaching Party’s sole expense.
        Neither Party may agree to settle any such Claim without the other Party’s
        express prior written consent.

       

      8. Non-solicitation.
        During the term of this Agreement and for twelve (12) months thereafter,
        each
        Party will not directly or indirectly solicit, induce, or attempt to induce
        any
        employee or independent contractor to terminate or breach any employment,
        contractual, or other relationship with the other Party.
        

       

      9. Termination
        & Cancellation

       

      9.1. The
        term
        of this Agreement shall begin on the Effective Date and, unless previously
        terminated as hereinafter set forth, shall remain in force until the expiration
        of the Warranty Period. 

       

      9.2. Each
        Party may, at its discretion, upon written notice to the other Party, and
        in
        addition to its rights and remedies provided under this Agreement or any
        other
        agreement executed in connection with this Agreement and at law or in equity,
        terminate this Agreement in the event of any of the following: 

       

      9.2.1. Upon
        a
        material breach of the other Party of any material provision in this Agreement,
        and failure of the other Party to cure such material breach within one hundred
        eighty (180) days after written notice thereof; provided, however, that such
        cure period shall not modify or extend the sixty (60) day cure period for
        SELLER’s delivery obligations pursuant to Section 4.4
        above;
        and provided, further that such one hundred eighty (180) day cure period
        shall
        not apply to BUYER’s failure to make any payment to SELLER pursuant to this
        Agreement. In the event of BUYER’s failure to make payment on the 30-day payment
        terms set forth in Section 3.1 hereof, termination by SELLER shall require
        the
        issuance of a written notice of default containing the threat of immediate
        termination if payment is not made within an additional grace period of not
        less
        than ten (10) business days.

       

      9.2.2. Upon
        the
        voluntary or involuntary initiation of bankruptcy or insolvency proceedings
        against the other Party; provided, that for an involuntary bankruptcy or
        insolvency proceeding, the Party subject to the proceeding shall have sixty
        (60)
        working days within which to dissolve the proceeding or demonstrate to the
        terminating Party’s satisfaction the lack of grounds for the initiation of such
        proceeding; 

       

      9.2.3. If
        the
        other Party (i) becomes unable, or admits in writing its inability, to pay
        its
        debts generally as they mature, (ii) becomes insolvent (as such term may
        be
        defined or interpreted under any applicable statute); or 

       

      9.2.4. In
        accordance with the provisions of Section 10
        below.

       

      9.3. In
        addition to BUYER’s termination rights pursuant to Sections 3.2
        and
9.2
        above,
        BUYER may terminate this Agreement upon written notice to SELLER, and without
        any further obligation or liability to SELLER, if at any time prior to delivery
        of the Equipment, Ex Works SELLER’s factory, BUYER has a justifiable reason to
        believe that SELLER will be more than sixty (60) days late in the delivery
        of
        the Equipment, BUYER may immediately cancel this agreement and shall, in
        addition to all other rights and remedies available in law and equity, be
        entitled to a refund of all payments that have been made as of such termination
        date, plus the maximum amount of liquidated damages payable pursuant to Section
        4.4
        above.

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
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      9.4. Upon
        the
        expiration or termination of this Agreement howsoever arising, the following
        Sections shall survive
        such expiration or termination: 1
        (Definitions); 6
        (Representations and Warranties); 7
        (Indemnification); 8
        (Non-solicitation)9
        (Termination & Cancellation); 11
        (Limitations of Liability); and 13
        (General
        Provisions).

       

      10. Force
        Majeure. Neither Party shall be liable to the other Party for failure of or
        delay in performance of any obligation under this Agreement, directly, or
        indirectly, owing to acts of God, war, war-like condition, embargoes, riots,
        strike, lock-out and other events beyond its reasonable control which were
        not
        reasonably foreseeable and whose effects are not capable of being overcome
        without unreasonable expense and/or loss of time to the affected Party (i.e.,
        the party that is unable to perform). If such failure or delay occurs, the
        affected Party shall notify the other Party of the occurrence thereof as
        soon as
        possible, and the Parties shall discuss the best way to resolve the event
        of
        force majeure. If the performance of SELLER is delayed for Force Majeure
        for a
        cumulative period of thirty (30) days or more, SELLER will use commercially
        reasonable efforts to transition its production of the Equipment for the
        duration of the Force Majeure to an alternate source. If the conditions of
        Force
        Majeure continue to materially impede performance of any material obligation
        under this Agreement for a period of more than three (3) consecutive calendar
        months (and, only if SELLER is the affected Party, SELLER has not used
        commercially reasonable efforts to transition its production of the Deliverables
        as provided in the immediately preceding sentence), then the non-affected
        Party
        shall be entitled to terminate this Agreement by 30 days prior written notice
        to
        the other Party. 

       

      11. Limitations
        of Liability

       

      11.1. IN
        NO
        EVENT SHALL EITHER PARTY BE LIABLE FOR INDIRECT, SPECIAL, INCIDENTAL OR
        CONSEQUENTIAL DAMAGES OR FOR EXEMPLARY OR PUNITIVE DAMAGES, EVEN IF BUYER
        OR
        SELLER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 

       

      11.2. NEITHER
        PARTY’S TOTAL LIABILITY TO THE OTHER FOR ANY KIND OF LOSS, DAMAGE OR LIABILITY
        ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT, UNDER ANY THEORY OF
        LIABILITY, SHALL EXCEED IN THE AGGREGATE THE AGREEMENT PRICE. 

       

      12. Financing.
        SELLER acknowledges that BUYER will be financing the construction of its
        polysilicon production plant, including the Work Site, through a combination
        of
        debt, equity and prepayments from BUYER’s customers. In connection with any debt
        financing, the lenders and the collateral agent may request SELLER to execute
        consents and provide a legal opinion. As such, SELLER agrees that on or prior
        to
        the date of financial closing on BUYER’s senior credit agreement providing for
        the financing of the development and operation of the Work Site, SELLER shall
        (and hereby agrees to) enter into a consent and agreement for the benefit
        of the
        collateral agent and secured parties substantially identical to the form
        of
        consent and agreement attached as Appendix
        7
        hereto
        (the “Consent”),
        and
        (c) SELLER shall (and hereby agrees, and instructs its counsel, to) provide
        an
        opinion of legal counsel substantially in the form and scope of the form
        of
        legal opinion attached to the Consent as Exhibit A (the “Legal
        Opinion”). 

       

    

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          10
          of 30

        
          

        

      

      
        
        

      

    

     

    13. General
      Provisions.

    
       

      13.1. Governing
        Law; Venue. This Agreement is governed by the laws of the State of New York
        without reference to any conflict of laws principles that would require the
        application of the laws of any other jurisdiction. The United Nations Convention
        on Contracts for the International Sale of Goods does not apply to this
        Agreement. Any dispute arising from or in connection with this Contract between
        the Parties shall be settled through friendly consultations. In case no
        agreement can be reached through consultations, the Parties shall submit
        to the
        International Chamber of Commerce. The arbitration tribunal shall be composed
        of
        three (3) arbitrators with each Party appointing one arbitrator and the third
        one mutually agreed by the Parties. The arbitration award is final and binding
        upon both Parties. The place of arbitration shall be New York, New York,
        and the
        arbitration proceedings shall be conducted in English.

       

      13.2. Severability.
        If any
        provision of this Agreement is, for any reason, held to be invalid or
        unenforceable, the other provisions of this Agreement will be unimpaired
        and the
        invalid or unenforceable provision will be deemed modified so that it is
        valid
        and enforceable to the maximum extent permitted by law.

       

      13.3. No
        Assignment.
        This
        Agreement and SELLER’s rights and obligations under this Agreement may not be
        assigned, delegated, or otherwise transferred, in whole or in part, by operation
        of law or otherwise, by SELLER without BUYER’s express prior written consent.
        Any attempted assignment, delegation, or transfer in violation of the foregoing
        will be null and void. BUYER may assign this Agreement, or any of its rights
        under this Agreement to any third party with or without SELLER’s
        consent.

       

      13.4. Notices.
        Each
        Party must deliver all notices, consents, and approvals required or permitted
        under this Agreement in writing to the other Party at the address listed
        below
        by courier, by certified or registered mail (postage prepaid and return receipt
        requested), or by a nationally-recognized overnight carrier. Notice will
        be
        effective upon receipt or refusal of delivery. Each Party may change such
        Party’s address for receipt of notice by giving notice of such change to the
        other Party.

       

      BUYER:
        

      HOKU
        MATERIALS, INC.

      One
        Hoku
        Way

      Pocatello,
        Idaho 83201 USA

      Attn:
        Mr.
        Karl Taft, CTO

      E-mail:
        [*]

      Facsimile:
        +1-808-682-7807

      

      With
        a
        copy to:

      

      HOKU
        SCIENTIFIC, INC.

      1075
        Opakapaka Street

      Kapolei,
        Hawaii 96707, USA

      Attn:
        Mr.
        Dustin Shindo, CEO

      E-mail:
        [*]

      Facsimile:
        +1 (808) 682-7800

      

      SELLER:
        

      

      Saft
        Power Systems USA Inc

      800
        Klein
        Road, Suite 400

      Plano,
        TX
        75074

      469-229-9600

      Fax:
        469:229-9650

      Contact:
        Marc Tefend

      [*]
 

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          11
          of 30

        
          

        

      

      
        
        

      

    

     

    
      13.5. Legal
        Fees.
        The
        prevailing Party in any litigation between the Parties relating to this
        Agreement will be entitled to recover such Party’s reasonable attorneys’ fees
        and court costs, in addition to any other relief that such Party may be
        awarded.

       

      13.6. Neither
        Party shall make any announcement or press release regarding this Agreement
        or
        any terms thereof without the other Party’s prior written consent; provided,
        however, that either Party may publicly disclose the material terms of this
        Agreement pursuant to the United States Securities Act of 1933, as amended,
        the
        United States Securities Exchange Act of 1934, as amended, or other applicable
        law; provided, however, that the Party being required to disclose the material
        terms of this Agreement shall provide reasonable advance notice to the other
        Party, and shall use commercially reasonable efforts to obtain confidential
        treatment from the applicable governing entity for all technical information
        set
        forth in this Agreement.

       

      13.7. Remedies.
        The
        rights and remedies provided to each Party in this Agreement are cumulative
        and
        in addition to any other rights and remedies available to such Party at law
        or
        in equity.

       

      13.8. Construction.
        Section
        headings are included in this Agreement merely for convenience of reference;
        they are not to be considered part of this Agreement or used in the
        interpretation of this Agreement. When used in this Agreement, “including” means
“including without limitation.” Whenever BUYER’s consent or approval is required
        under this Agreement, BUYER may grant or deny its consent or approval in
        its
        sole and absolute discretion. No rule of strict construction will be applied
        in
        the interpretation or construction of this Agreement.

       

      13.9. Waiver.
        All
        waivers must be in writing and signed by the Party to be charged. Any waiver
        or
        failure to enforce any provision of this Agreement on one occasion will not
        be
        deemed a waiver of any other provision or of such provision on any other
        occasion.

       

      13.10. Entire
        Agreement; Amendments.
        This
        Agreement is the final, complete, and exclusive agreement of the Parties
        with
        respect to the subject matter hereof and supersedes and merges all prior
        or
        contemporaneous communications and understandings between the Parties. No
        modification of or amendment to this Agreement will be effective unless in
        writing and signed by the Party to be charged.

       

      [This
        space intentionally left blank.]

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          12
          of 30

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the parties have executed this Equipment Purchase & Sale
      Agreement as of the date first set forth above.

     

    
      	
              SELLER:

            	 	
              BUYER:

            
	 	 	 	 	 
	
              SAFT
                POWER SYSTEMS USA INC

            	 	
              HOKU
                MATERIALS, INC.

            
	 	 	 	 	 
	
              By:

            	
              /s/
                KAIVON S. MORTAZAVI

            	 	
              By:

            	
              /s/
                DUSTIN SHINDO

            
	 	 	 	 	 
	
              Name:

            	
              Kaivon
                S. Mortazavi

            	 	
              Name:

            	
              Dustin
                Shindo

            
	 	 	 	 	 
	
              Title:

            	
              Vice
                President

            	 	
              Title:

            	
              Chairman
                & CEO

            
	
              Authorized
                Signatory

            	 	
              Authorized
                Signatory

            

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          13
          of 30

        
          

        

      

      
        
        

      

    

    APPENDIX
      1 

     

    Technical
      Specifications for Thyrobox VSC For Reactors with Earth Fault Detection Set
      

     

    [*]

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          14
          of 30

        
          

        

      

      
        
        

      

    

    APPENDIX
      2
      

     

    Specification
      of Technical Documentation

     

    The
      manuals for the Thyrobox VSC will be available in English language.

     

    Technical
      Documentation 

     

    The
      Technical Documentation includes

     

    Operating
      instructions

     

    Mechanical
      drawings, incl. dimensional drawings

     

    Mechanical
      connection plans

     

    Overview
      circuit diagram

     

    Operation
      circuit diagram

     

    Information
      for transformer

     

    Thyrobox
      VSC test certificate

     

    Project
      Documentation 

     

    Accompanying
      to the project a MANUFACTURING SCHEDULE AND PROGRESS REPORT will inform about
      the status of the project progress. Contents of the REPORT (approx. 5 pages)
      are

     

    
      	 	
              ·

            	
              General
                project information (overview)

            

    

     

    
      	 	
              ·

            	
              Current
                project schedule

            

    

     

    
      	 	
              ·

            	
              Current
                project status related to delivery batches, incl.
                topics

            

    

     

    
      	 	
              o

            	
              design
                and construction

            

    

     

    
      	 	
              o

            	
              Purchasing
                of time-critical material

            

    

     

    
      	 	
              o

            	
              Purchasing
                of Material (Material with normal delivery
                periods)

            

    

     

    
      	 	
              o

            	
              Availability
                of time-critical Material (Material with long delivery
                periods)

            

    

     

    
      	 	
              o

            	
              Availability
                of Material (Material with normal delivery
                periods)

            

    

     

    
      	 	
              o

            	
              Premanufaturing
                (of sub-components)

            

    

     

    
      	 	
              o

            	
              Final
                Assembly (Cabinets)

            

    

     

    
      	 	
              o

            	
              Pre-Testing

            

    

     

    
      	 	
              o

            	
              Final
                Test (Cabinets)

            

    

     

    
      	 	
              o

            	
              Seaworth
                packing (Cabinets)

            

    

     

    
      	 	
              o

            	
              Ready
                for shipment 

            

    

     

    Delivery
      time of documentation

     

    Product
      documentation will be available within 120 days after BUYER’s payment to SELLER
      of the Initial Payment.

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          15
          of 30

        
          

        

      

      
        
        

      

    

    APPENDIX
      3

     

    Procedure
      for Factory Acceptance Test

     

    [*]

     

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          16
          of 30

        
          

        

      

      
        
        

      

    

    Appendix
      4

     

    Procedures
      for Commissioning Test

     

    [*]

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          17
          of 30

        
          

        

      

      
        
        

      

    

    Appendix
      5

     

    Factory
      Acceptance Certificate

     

    This
      Factory Acceptance Certificate is being signed pursuant to Section 5.2.2
      of the
      Equipment Purchase & Sale Agreement (the “Agreement”)
      dated
      _______________, 2007, by and between HOKU MATERIALS, INC., and SAFT POWER
      SYSTEMS USA INC. Capitalized terms not otherwise defined herein have the meaning
      set forth in the Agreement.

     

    By
      signing below, each party hereby certifies to the successful completion of
      the
      Factory Acceptance Test and confirms the following: 

     

    [*]

    

    
      	
              SAFT
                POWER SYSTEMS USA INC

            	 	
              HOKU
                MATERIALS, INC.

            
	 	 	 	 	 
	
              By:

            	  
	 	
              By:

            	  

	 	 	 	 	 
	
              Name:

            	  
	 	
              Name:

            	  

	 	 	 	 	 
	
              Title:

            	  
	 	
              Title:

            	  

	
              Authorized
                Signatory

            	 	
              Authorized
                Signatory

            

    

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          18
          of 30

        
          

        

      

      
        
        

      

    

    

    Appendix
      7

     

    Certificate
      of Commissioning

     

    This
      Certificate of Commissioning is being signed pursuant to Section 5.3.2
      of the
      Equipment Purchase & Sale Agreement (the “Agreement”)
      dated
      _______________, 2007, by and between HOKU MATERIALS, INC., and SAFT POWER
      SYSTEMS USA INC. Capitalized terms not otherwise defined herein have the meaning
      set forth in the Agreement.

     

    By
      signing below, each party hereby certifies to the successful completion of
      the
      Commissioning Test and confirms the following: 

     

    [*]

    
      	
              SAFT
                POWER SYSTEMS USA INC

            	 	
              HOKU
                MATERIALS, INC.

            
	 	 	 	 	 
	
              By:

            	  
	 	
              By:

            	  

	 	 	 	 	 
	
              Name:

            	  
	 	
              Name:

            	  

	 	 	 	 	 
	
              Title:

            	  
	 	
              Title:

            	  

	
              Authorized
                Signatory

            	 	
              Authorized
                Signatory

            

    

     

    
      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          19
          of 30

        
          

        

      

      
        
        

      

    

    Appendix
      7

     

    Consent
      

     

    [See
      Attached]

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          20
          of 30

        
          

        

      

      
        
        

      

    

    CONSENT
      AND AGREEMENT

     

    This
      CONSENT AND AGREEMENT, dated as of [__________], 2007 (as amended, restated,
      supplemented or otherwise modified from time to time, this “Consent”), is
      entered into by and among [_____________], a [_______________] (together with
      its successors and assigns, the “Contracting Party”), HOKU MATERIALS, INC., a
      Delaware corporation (together with its successors and assigns, the “Borrower”),
      and [___________], in its capacity as Collateral Agent for the Secured Parties
      (as defined below) (together with its successors, designees and assigns in
      such
      capacity, the “Agent”) under the Intercreditor Agreement (as defined
      below).

     

    RECITALS

     

    A. The
      Borrower has entered into a Credit Agreement, dated as of [_______], 2007 (as
      amended, restated, supplemented or otherwise modified from time to time, the
      “Credit Agreement”), by and among the Borrower, the financial institutions from
      time to time parties thereto as lenders, and [___________________], as
      administrative agent (the “Administrative Agent”).

     

    B. The
      Contracting Party has entered into [______________], dated as of [__________],
      2007, (as amended, restated, supplemented or otherwise modified from time to
      time, the “Contract”), with the Borrower.

     

    C. The
      Borrower intends to finance certain costs in connection with the development,
      construction, operation, maintenance and ownership of a polysilicon producing
      processing plant with a nominal capacity of 2,000 metric tons per year, located
      in Pocatello, Idaho (the “Project”), with funds borrowed by the Borrower
      pursuant to the terms of the Credit Agreement.

     

    E. As
      collateral security for all obligations of the Borrower to the Secured Parties
      (as defined below), the Borrower has, inter alia, assigned all of its rights,
      title and interest (the “Assigned Interests”) in, to and under the Contract to
      the Agent pursuant to a Security Agreement, dated as of [_______], 2007 (as
      amended, restated, supplemented or otherwise modified from time to time, the
      “Security Agreement”), made by the Borrower in favor of the Agent for the
      benefit of certain secured parties described therein (the “Secured Parties”) and
      in that certain Collateral Agency and Intercreditor Agreement, dated as of
      [_______], 2007 (as amended, restated, supplemented or otherwise modified from
      time to time, the “Intercreditor Agreement”), among the Borrower, Hoku Materials
      Holdings, Inc., the Agent, the Administrative Agent, the Contracting Party
      and
      the other Secured Parties party thereto. 

     

    F. Pursuant
      to the terms of the Intercreditor Agreement, the Secured Parties have appointed
      the Agent as collateral agent on their behalf and authorized the Agent to take
      certain actions and exercise such powers under the Secured Obligation Documents
      (as defined in the Intercreditor Agreement) as are provided for
      therein.

     

    G. The
      Borrower has requested that the Contracting Party and the other parties hereto
      execute and deliver this Consent in fulfillment of certain obligations of the
      Borrower under the Credit Agreement. 

     

    AGREEMENT

     

    NOW,
      THEREFORE, in consideration of the foregoing premises and for good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged,
      and
      intending to be legally bound, the parties hereto agree as follows:

     

    1. Consent
      and Agreements.

     

    (a) Subject
      to the terms and conditions of this Consent, the Contracting Party acknowledges
      and consents to the assignment as collateral security to the Agent, for the
      benefit of the Secured Parties, of the Assigned Interests. The Contracting
      Party
      further acknowledges the right of Agent or any designee of Agent, in exercise
      of
      Agent’s rights and remedies as a secured creditor of Borrower, to make all
      demands, give all notices, take all actions and exercise all rights of Borrower
      under the Contract.

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          21
          of 30

        
          

        

      

      
        
        

      

    

     

    (b) The
      Agent
      shall be entitled (but not obligated) to cure any defaults of the Borrower
      under
      the Contract in accordance with the provisions hereof. Upon receipt by the
      Contracting Party of written notice from the Agent, the Contracting Party agrees
      to (i) accept such cure by the Agent and, subject to the terms and conditions
      of
      the Contract and cure of such defaults, to render to the Secured Parties all
      performance due by it under the Contract and this Consent, and (ii) act solely
      on the instructions of the Agent, not the Borrower, with respect to the exercise
      of the Borrower’s rights under the relevant Contract. The Contracting Party
      agrees to make all payments to be made by it under the Contract directly to
      the
      Agent for the benefit of the Secured Parties upon receipt of the Agent’s written
      instructions to do so and any such payments made to the Agent by the Contracting
      Party shall be deemed to have been made by the Contracting Party in fulfillment
      of the Contracting Party’s obligations to the Borrower under the Contract.

     

    (c) In
      all
      cases except as provided in the Contract or required by law, and in accordance
      with Section 1(e) hereof, the Contracting Party will not, without the prior
      written consent of the Agent (such consent not to be unreasonably withheld),
      (i)
      cancel or terminate the Contract or suspend performance of its services
      thereunder, or consent to or accept any cancellation, termination or suspension
      thereof by the Borrower, (ii) amend the Contract [NOTE: Exceptions will be
      limited to Change Orders otherwise permitted under the Credit Agreement], or
      (iii) sell, assign or otherwise dispose (by operation of law or otherwise)
      of
      any part of its rights, title or interest in the Contract. The Contracting
      Party
      agrees to deliver copies of all notices of default, notices of the suspension
      of
      performance by Contracting Party, notices of force majeure or requests for
      change orders delivered by Contracting Party to Borrower under or pursuant
      to
      the Contract to the Agent promptly upon delivery thereof.

     

    (d) The
      Contracting Party will not terminate or suspend performance of the Contract
      on
      account of any default or breach of the Borrower thereunder without written
      notice to the Agent and first providing to the Agent (i) 30 days from the date
      notice of default or breach is delivered to the Agent to cure such default
      if
      such default is the failure to pay amounts to the Contracting Party which are
      due and payable under the Contract, or (ii) a reasonable period, but not fewer
      than 60 days, to cure such breach or default if the breach or default cannot
      be
      cured by the payment of money to the Contracting Party so long as the Agent,
      the
      Borrower or their respective designee shall have commenced to cure the breach
      or
      default promptly following such notice and in any case within such 60-day period
      and thereafter diligently pursues such cure to completion (but in any event
      within not more than 120 days) and during such cure period performs all monetary
      obligations under the Contract and all other obligations under the Contract
      are
      performed by the Borrower or the Agent or their respective designees. For the
      avoidance of doubt and solely for the purposes of the preceding sentence,
      amounts not paid and subject to a dispute in good faith by the Borrower shall
      not be deemed to be a payment default. The Contracting Party shall not hinder
      the Agent’s or its designees’ efforts, and shall provide reasonable cooperation
      to the Agent and its designees, in effecting any cure of any default or breach
      of the Borrower under the Contract. Except in the event of a payment default
      under the Contract, if possession of the Project is necessary to cure such
      breach or default, and the Agent or its designees or assignees declares the
      Borrower in default under the Credit Agreement and within the 60-day period
      described above commences foreclosure proceedings, the Agent or its designees
      or
      assignees shall be allowed a reasonable period to complete such proceedings
      so
      long as (A) the Agent proceeds diligently and in good faith to do so and during
      such period performs all monetary obligations under the Contract, and (B) all
      other obligations under the relevant Contract are performed by the Borrower
      or
      the Agent or their respective designees. If the Agent or its designees or
      assignees are prohibited by any court order or bankruptcy or insolvency
      proceedings from curing the default or from commencing or prosecuting
      foreclosure proceedings, the foregoing time periods shall be extended by the
      period of such prohibition so long as (1) the Agent proceeds diligently and
      in
      good faith to address such impediments and during such period performs all
      monetary obligations under the Contract, and (2) all other obligations under
      the
      Contract are performed by the Borrower or the Agent or their respective
      designees. The Contracting Party consents to the transfer of the Borrower’s
      interest under each Contract to the Agent or any purchaser, successor, assignee
      and/or designee (a “Subsequent Transferee”) of the Assigned Interests at a
      foreclosure sale by judicial or nonjudicial foreclosure and sale or by a
      conveyance by the Borrower in lieu of foreclosure and agrees that,
      notwithstanding any provision of the Contract to the contrary, upon such
      foreclosure, sale or conveyance, the Agent or such Subsequent Transferee shall
      be substituted for the Borrower under the Contract and the Contracting Party
      (a)
      shall recognize the Agent or the Subsequent Transferee, as the case may be,
      as
      its counter-party under the Contract, and (b) perform its obligations under
      the
      Contract in favor of the Agent or the Subsequent Transferee, as the case may
      be;
      provided that the Agent or such Subsequent Transferee (i) has elected to assume
      the rights and obligations of the Borrower (including the obligation to cure
      any
      then existing payment and performance defaults, but excluding any obligation
      to
      cure any then existing performance defaults which by their nature are incapable
      of being cured and which default that is incapable of being cured does not
      materially and adversely affect the rights of the Contracting Party under the
      Contract) under the Contract, and (ii) would reasonably be expected to have
      the
      capability to perform the Borrower’s obligations under the
      Contract.

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          22
          of 30

        
          

        

      

      
        
        

      

    

     

    (e) Subject
      to payment of all amounts due and unpaid to the Contracting Party and cure
      of
      all then existing payment and performance defaults, but excluding any obligation
      to cure any then existing performance defaults which by their nature are
      incapable of being cured and which default that is incapable of being cured
      does
      not materially and adversely affect the rights of the Contracting Party under
      the Contract, in the event the Contract is rejected or terminated by a trustee
      or debtor in possession in any bankruptcy or insolvency proceeding, or if the
      Contract is terminated for any reason other than a default which could have
      been
      but was not cured by the Agent as provided in Section 1(e) hereof, and if,
      within 45 days after such rejection or termination, the Agent shall so request,
      the Contracting Party shall execute and deliver to the Agent a new Contract
      having substantially identical terms to the Contract (subject to any conforming
      changes necessitated by the substitution of parties and such changes as may
      be
      necessary to compensate the Contracting Party for schedule and cost adjustments
      resulting from the passage of time).

     

    (f) In
      the
      event the Agent or its designees or assignees elect to perform the Borrower’s
      obligations under a Contract or a new Contract is entered into as provided
      above
      in Sections 1(e) or (f), respectively, the liability of the Agent, or its
      designees or assignees, as the case may be, to the Contracting Party for the
      performance of obligations under such Contract, and the sole recourse of the
      Contracting Party in seeking the enforcement of such obligations, shall be
      limited to such parties’ rights, title and interest in the Project.

     

    (g) Except
      as
      provided in Sections 1(e), (f) and (g) above, neither the Agent, its designees
      or assignees shall have any obligation or liability under the Contract, nor
      shall the Agent, its designees or assignees be obligated to perform any of
      the
      obligations or duties of the Borrower under the Contract or to take any action
      or collect or enforce any claim for payment or performance of the Assigned
      Interests. Within 30 or 60 days, as the case may be pursuant to Section 1(e),
      of
      being notified by the Contracting Party that a Borrower default or breach has
      occurred under the Contract, the Agent shall notify the Contracting Party of
      its
      intent whether or not to cure any such Borrower default or breach. In the event
      the Agent fails to notify the Contracting Party within the time period described
      in the foregoing sentence that the Agent will cure such default or breach,
      the
      Contracting Party shall be entitled to assume that the Agent has elected not
      to
      cure such default or breach and the Contracting Party may then exercise all
      rights that the Contracting Party would have under the Contract, without regard
      to the provisions of this Consent. In the absence of such notice, no performance
      by the Agent, its designees or assignees under or pursuant to this Consent
      or
      otherwise (whether to cure a Borrower default or exercise rights under any
      provision hereof or otherwise) shall be construed as an assumption by the Agent,
      its designees or assignees of the obligations and duties of the Borrower under
      the Contract, unless otherwise expressly agreed in writing by the Agent, its
      assignees or designees, as the case may be. The Agent shall have the right
      to
      assign all or a pro rata interest in a Contract or a new Contract entered into
      pursuant to Section 1(f) to a person or entity to whom the Project is
      transferred, provided such transferee (i) assumes the obligations of the
      Borrower (or the Secured Parties) under such Contract and cure of any material
      defaults under such Contract has been effected as provided herein, and (ii)
      would reasonably be expected to have the capability to perform the Borrower’s
      obligations under such Contract. Upon such assignment, the Agent and the Secured
      Parties (including their agents and employees) shall be released from any
      further liability thereunder to the extent of the interest assigned.

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          23
          of 30

        
          

        

      

      
        
        

      

    

     

    2. Borrower’s
      Acknowledgment. The Borrower acknowledges and agrees that the Contracting Party
      is authorized to act in accordance with the Agent’s exercise of the Borrower’s
      rights in accordance with this Consent, and the Contracting Party may rely
      on
      any notice or instruction by the Agent in the purported exercise of the Agent’s
      rights and remedies hereunder.

     

    3. Legal
      Opinion. The Contracting Party hereby agrees to deliver to the Agent a legal
      opinion (which may be from a senior in-house counsel), dated as of the dated
      hereof, substantially in form attached hereto as Exhibit A. 

     

    4. Payment
      of Monies. The Contracting Party hereby agrees to make all payments to be made
      by it to the Borrower under the Contract by wire transfer directly
      to:

     

    (a) for
      all
      payments not covered by clause (b) hereof: 

     

    [_______________]

     

    ABA
      [__________]

     

    [_______________]

     

    Account
      Number: [_______]

     

    FFC:
      Account No. [_______]

     

    REF:
      [Hoku Materials] Revenue Account; or

     

    (b) for
      all
      payments of liquidated damages and insurance proceeds:

     

    [_______________]

     

    ABA
      [__________]

     

    [_______________]

     

    Account
      Number: [_______]

     

    FFC:
      Account No. [_______]

     

    REF:
      [Hoku Materials] Loss Proceeds Account,

     

    and
      any
      notices to [Depositary Bank] may be given to the following address:

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          24
          of 30

        
          

        

      

      
        
        

      

    

    [_______________]

     

    [_______________]

     

    [_______________]

     

    [_______________]

     

    Attn:
      [_______________]

     

    Telephone:
      [_______________]

     

    Facsimile:
      [_______________]

     

    Notwithstanding
      the foregoing, (i) if the Agent shall notify the Contracting Party in writing
      that an Event of Default under the Credit Agreement has occurred and is
      continuing, the Contracting Party shall make all payments to be made by it
      to
      the Borrower under the Contract directly to the Agent, for the benefit of the
      Secured Parties, to an account designated by the Agent in such written notice,
      and (ii) if any person has elected to become a Subsequent Transferee, then
      the
      Contracting Party shall make all payments to be made by it to the Borrower
      under
      the Contract directly to such Subsequent Transferee. Any payments made by the
      Contracting Party as provided under this Section 4 shall be deemed to have
      been
      made by the Contracting Party in fulfillment of the Contracting Party’s
      obligations under the Contract.

     

    5. Representations
      and Warranties. The Contracting Party hereby represents and warrants, for the
      benefit of the Agent and the Secured Parties, as of the date hereof,
      that:

     

    (a) it
      (i) is
      duly organized, validly existing and in good standing under the laws of
      [__________], and (ii) has all requisite organizational power and authority
      necessary to execute, deliver and perform its obligations under this Consent
      and
      the Contract;

     

    (b) the
      execution, delivery and performance by the Contracting Party of the Contract
      and
      this Consent have been duly authorized by all necessary corporate action, and
      do
      not and will not require any further consents or approvals which have not been
      obtained, or violate any provision of any law, regulation, order, judgment,
      injunction or similar matters or breach any agreement presently in effect with
      respect to or binding on the Contracting Party, except for such breaches,
      defaults, or violations as will not, either individually or in the aggregate,
      result in a material adverse effect on the ability of the Contracting Party
      to
      perform its obligations under this Consent or the Contract;

     

    (c) each
      of
      this Consent and the Contract constitutes legal, valid and binding obligations
      of the Contracting Party, enforceable against the Contracting Party in
      accordance with their respective terms, except to the extent that enforceability
      may be limited by applicable bankruptcy, insolvency, moratorium, reorganization
      or other similar laws affecting the enforcement of creditors’ rights or by the
      effect of general equitable principles (regardless of whether such
      enforceability is considered in a proceeding in equity or at law);

     

    (d) no
      authorizations, approvals or consents of any governmental or regulatory
      authority or agency or any other person, and no filings or registrations with
      any governmental authority or agency, are necessary for the execution, delivery
      or performance by the Contracting Party of this Consent, or for the validity
      or
      enforceability thereof, except for any authorizations, approvals, consents
      or
      filings which (i) have been made or obtained prior to the date hereof and are
      in
      full force and effect, or (ii) are obtainable in the ordinary course of business
      and are set forth on Exhibit B to this Consent;

     

    (e) except
      pursuant to this Consent and as expressly set forth in the Contract, the
      Contracting Party has not consented to any pledge, assignment or other transfer
      of any interest in the Contract;

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          25
          of 30

        
          

        

      

      
        
        

      

    

    (f) the
      Contract is in full force and effect and has not been amended, supplemented
      or
      modified (except as otherwise disclosed in writing to the Agent);
      and

     

    (g) the
      Borrower has fulfilled all of its material obligations which are currently
      due
      under the Contract, and there are no breaches or unsatisfied conditions
      presently existing (or which would exist after the passage of time and/or giving
      of notice) that would allow the Contracting Party to terminate the Contract.
      

     

    6. Limitation
      of Liability. The Contracting Party shall have no liability under this Consent
      to the Borrower. With respect to any undertaking by the Contracting Party which
      is susceptible to enforcement by specific enforcement as described in Section
      7,
      where the Agent would receive the full benefit of this Consent through such
      specific performance, the Agent shall limit its remedy to specific performance.
      With respect to any other undertaking, acknowledgment, representation and
      warranty or other provision of this Consent, the Agent’s remedies shall not be
      so limited, provided that the Agent and the Borrower agree that the Contracting
      Party’s aggregate liability for monetary damages under this Consent and the
      Contract shall be limited as provided in the Contract. Under no circumstances
      shall the Contracting Party have any liability for any punitive, exemplary,
      consequential, indirect, incidental, or special damages (including by way of
      example, but not by way of limitation, loss of profits, nonpayment of principal
      or interest on loans, and cost of capital under the Credit
      Agreement).

     

    7. Specific
      Performance. The Contracting Party acknowledges and agrees that the Borrower,
      the Agent, the Secured Parties and any Subsequent Transferee may be damaged
      irreparably in the event any of the provisions set forth in Sections 1 and
      4 of
      this Consent (the “Applicable Provisions”) are not performed in accordance with
      their specific terms or are otherwise breached. Accordingly, the Contracting
      Party agrees that the Borrower, the Agent and/or any Subsequent Transferee
      may
      seek to enforce specifically this Consent and the Applicable Provisions in
      any
      action instituted in any court of the United States or any state thereof having
      jurisdiction over the parties hereto and the matter hereof (subject to the
      provisions set forth in Section 9), in addition to any other remedy to which
      it
      may be entitled, at law or in equity.

     

    8. Governing
      Law. This Consent shall be governed by, and construed and interpreted in
      accordance with, the laws of the State of New York, United States of America,
      excluding its conflicts of law provisions (other than Sections 5-1401 and 5-1402
      of the General Obligations Law of the State of New York).

     

    9. Submission
      to Jurisdiction. The parties hereto submit to the nonexclusive jurisdiction
      of
      the United States District Court for the Southern District of New York and
      of
      any New York State court sitting in New York City for purposes of all legal
      proceedings arising out of or relating to this Consent or the transactions
      contemplated hereby. Each of the parties hereto irrevocably waives, to the
      fullest extent permitted by law, any objection which it may now or hereafter
      have to the laying of the venue of any such proceeding brought in such a court
      and any claim that any such proceeding brought in such a court has been brought
      in an inconvenient forum.

     

    10. Counterparts.
      This Consent and any amendments, waivers, consents or supplements hereto or
      in
      connection herewith may be executed in any number of counterparts and by
      different parties hereto in separate counterparts, each of which when so
      executed and delivered shall be deemed an original, but all such counterparts
      together shall constitute but one and the same instrument; signature pages
      may
      be detached from multiple separate counterparts and attached to a single
      counterpart so that all signature pages are physically attached to the same
      document.

     

    11. Severability.
      In case any one or more of the provisions contained in this Consent should
      be
      invalid, illegal or unenforceable in any respect, the validity, legality and
      enforceability of the remaining provisions shall not in any way be affected
      or
      impaired thereby.

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          26
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    12. Amendment,
      Waiver. Neither this Consent nor any of the terms hereof may be terminated,
      amended, supplemented, waived or modified except by an instrument in writing
      signed by the Contracting Party, the Borrower and the Agent.

     

    13. Notices.
      All notices required or permitted hereunder shall be in writing and shall be
      effective (a) upon receipt if hand delivered, (b) upon receipt if sent by
      facsimile and (c) if otherwise delivered, upon the receipt thereof. Any such
      notices to the Contracting Party or the Borrower shall be delivered to their
      respective addresses as specified in the Contract. Any such notices to the
      Agent
      shall be addressed as follows:

     

    [_______________]

     

    [_______________]

     

    [_______________]

     

    Attn:
      [_______________]

     

    Telephone
      No.: [_______________]

     

    Telecopy
      No.: [_______________]

     

    If
      any
      notice is tendered to an addressee and the delivery thereof is refused by such
      addressee, such notice shall be effective upon such tender. Any party shall
      have
      the right to change its address for notice hereunder to any other location
      within the continental United States by providing 30 days’ notice to the other
      parties in the manner set forth hereinabove. 

     

    14. Third
      Party Beneficiaries. This Consent and the representations, covenants and
      agreements contained herein are and shall be held to be for the sole benefit
      of
      the parties hereto and the Secured Parties, and their respective successors
      and
      assigns.

     

    15. Interpretation.
      All references in this Consent to any document, instrument or agreement (a)
      shall include all exhibits, schedules and other attachments thereto, and (b)
      shall include all documents, instruments or agreements issued or executed in
      replacement thereof in accordance with the terms thereof.

     

    [SIGNATURE
      PAGE FOLLOWS]

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

    
      
        
        

      

      
        Page
          27
          of 30

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto, by their officers duly authorized,
      intending to be legally bound, have caused this Consent and Agreement to be
      duly
      executed and delivered as of the date first above written.

     

    HOKU
      MATERIALS, INC, 

     

    
      	
              By:

            
	
              Name:

            
	
              Title:

            
	 
	
              [___________________________]

            
	
              By:

            
	
              Name:

            
	
              Title:

            
	 
	
              [_______________],

            
	
              as
                Agent for the Secured Parties

            
	
              By:

            
	
              Name:

            
	
              Title:

            

    

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          28
          of 30

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

     

    FORM
      OF
      OPINION OF CONTRACTING PARTY’S COUNSEL

     

    [Letterhead
      of ________________]

     

    [Date]

     

    [Agent]

     

    [_______________]

     

    [_______________]

     

    [_______________]

     

    Ladies
      and Gentlemen:

     

    [We/I]
      have acted as counsel for [_______________], a [________________] (the
“Company”), in connection with that certain [Contract and Consent]
      (collectively, the “Contracts”). Capitalized terms used and not otherwise
      defined herein shall have the respective meanings specified in the
      Consent.

     

    This
      letter is being delivered to you in satisfaction of the condition set forth
      in
      Section 3 of the Consent. 

     

    In
      this
      connection, [we/I] have examined such certificates of public officials,
      certificates of officers of the Company and copies certified to [our/my]
      satisfaction of corporate documents and records of the Company and of other
      papers, and have made such other investigations, as [we/I] have deemed relevant
      and necessary as a basis for [our/my] opinions hereinafter set forth. [We/I]
      have relied upon such certificates of public officials and of officers of the
      Company with respect to the accuracy of material factual matters contained
      therein which were not independently established.

     

    Based
      on
      the foregoing, it is [our/my] opinion that:

     

    1.
      The
      Company is a corporation duly incorporated and validly existing in good standing
      under the laws of [__________]. 

     

    2.
      The
      Contracts have been duly authorized by all requisite corporate action and duly
      executed and delivered by authorized officers of the Company, and are valid
      obligations of the Company, legally binding upon and enforceable against the
      Company in accordance with their respective terms, except as such enforceability
      may be limited by (a) bankruptcy, insolvency, reorganization or other similar
      laws affecting the enforcement of creditors’ rights generally, and (b) general
      principles of equity (regardless of whether such enforceability is considered
      in
      a proceeding in equity or at law). 

     

    3.
      The
      execution and delivery of the Contracts, and fulfillment of and compliance
      with
      the respective provisions of the Contracts, do not conflict with, or result
      in a
      breach of the terms, conditions or provisions of, or constitute a default under,
      or result in any violation of, or result in the creation of any lien upon any
      of
      the properties or assets of the Company pursuant to, or require any
      authorization, consent, approval, exemption, or other action by or notice to
      or
      filing with any court, administrative or governmental body or other person
      or
      entity pursuant to, the charter or by-laws of the Company, any applicable law,
      statute, rule or regulation or (insofar as is known to us after having made
      due
      inquiry with respect thereto) any agreement, instrument, order, judgment or
      decree to which the Company is a party or otherwise subject. 

     

    Very
      truly yours,

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          29
          of 30

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    AUTHORIZATIONS
      AND APPROVALS

     

    [Contracting
      Party To Provide, If Any]

     

      	
              SELLER
                Initials & Date KM
                March 4, 2008

            	
              BUYER
                Initials & Date DS
                March 19, 2008

            

    

     

    
      
        
        

      

      
        Page
          30
          of 30

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