SUPPLY AGREEMENT
Exhibit
10.82
CONFIDENTIAL
[*]
=
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.
This
Agreement is made as of the last date set forth on the signature page hereto
(the “Effective
Date”)
between TIANWEI NEW ENERGY (CHENGDU) WAFER CO., LTD., a People’s Republic of
China company (hereinafter “TIANWEI”)
and
HOKU
MATERIALS, INC., a
Delaware corporation (hereinafter “HOKU”).
HOKU
and TIANWEI are sometimes referred to in the singular as a “Party”
or
in
the plural as the “Parties”.
Recitals
Whereas,
HOKU desires to supply polysilicon to TIANWEI for its general use beginning
in
calendar year 2010 for a continuous period of ten years from the date of the
first shipment.
Whereas,
in exchange for HOKU’s agreement to allocate the supply of polysilicon, TIANWEI
desires to provide HOKU with a firm order for polysilicon upon the terms and
conditions provided herein.
NOW,
THEREFORE, in furtherance of the foregoing Recitals and in consideration of
the
mutual covenants and obligations set forth in this Agreement, the Parties hereby
agree as follows:
1. Definitions.
The
following terms used in this Agreement shall have the meanings set forth
below:
1.1. “Affiliate”
shall
mean, with respect to either Party to this Agreement, any entity that
is
controlled by or under common control with such Party.
1.2. “Agreement”
shall
mean this Supply Agreement and all appendices annexed to this Agreement
as the
same may be amended from time to time in accordance with the provisions
hereof.
1.3. “Effective
Date”
has
the
meaning set forth in the first paragraph of this Agreement.
1.4. “First
Shipment Date”
shall
mean the first day after March 1, 2010, when HOKU commences deliveries
to
TIANWEI of Products pursuant to this Agreement.
1.5. “Facility”
shall
mean any facility used by HOKU for the production of the Product.
1.6. “Independent
Expert”
means
any Qualified Laboratory that is reasonably acceptable to each of HOKU
and
TIANWEI; provided, however that if such parties cannot agree on the Independent
Expert within ten (10) days, each Party shall select one independent
expert form
the list of Qualified Laboratories, and those two independent experts
shall
select the Independent Expert.
1.7. “Minimum
Annual Quantity of Product”
means
[*] metric tons ([*] kilograms).
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1.8. “Product”
shall
mean the raw polysilicon in chunk form manufactured by HOKU and sold
to TIANWEI
pursuant to this Agreement.
1.9. “Product
Specifications”
shall
mean the quality and other specifications set forth on Appendix 2 to
this
Agreement.
1.10. “Qualified
Laboratory”
means
each qualified laboratory set forth on Appendix
2
to this
Agreement.
1.11. “Term”
shall
mean the period during which this Agreement is in effect, as more specifically
set forth in Section 9
of this
Agreement.
1.12. “Total
Deposit”
shall
mean all deposits or prepayments made by TIANWEI to HOKU hereunder including
without limitation the Initial Deposit and the Main Deposit.
1.13. “Year”
shall
mean each of the ten (10) twelve-month periods commencing on the First
Shipment
Date.
2. Ordering.
Starting
on the First Shipment Date and each Year during the term of this Agreement
thereafter, TIANWEI agrees to purchase from HOKU, and HOKU agrees to
sell to
TIANWEI, the Minimum Annual Quantity of Product at the prices set forth
on
Appendix 1 to this Agreement (the “Pricing
Schedule”).
This
Agreement constitutes a firm order from TIANWEI for [*] metric tons
of Product
that cannot be cancelled during the term of this Agreement, except
as set forth
in Section 9
below.
3. Supply
Obligations.
3.1. HOKU
shall deliver each Year pursuant to this Agreement starting on the
First
Shipment Date at least the Minimum Annual Quantity of Product in
approximately
equal monthly shipments pursuant to Section 4.1 below; provided however,
that if
HOKU fails to deliver a monthly shipment, then HOKU may deliver any
deficiency
within [*] days without breaching this section or incurring any purchase
price
adjustment (pursuant to Section 3.3
below).
The foregoing [*] day grace period shall not apply to the first shipment
that is
scheduled for March 31, 2010. Only shipments in excess of each scheduled
monthly
shipment pursuant to the Shipment Schedule (as defined in Section
4.1
below)
will be considered as making up a quantity deficiency as stated above.
Notwithstanding the preceding sentence, HOKU shall promptly inform
TIANWEI of
any occurrence which will, or may be expected to, result in material
delay of
the shipment date or quantity of any scheduled monthly shipment set
forth in the
Shipment Schedule, or any other material deviations from the Shipment
Schedule.
HOKU shall use all commercially reasonable efforts to make complete
delivery of
Products scheduled for monthly shipment pursuant to the Shipment
Schedule or, if
later, as soon as commercially practicable. In the event that HOKU
fails to
deliver Products in accordance with the Shipment Schedule, TIANWEI
may cause
HOKU at HOKU’s own shipping responsibility, cost and expense to deliver Products
to the locations designated by TIANWEI by rail or ocean cargo vessel.
At any
time during the term of this Agreement, HOKU may ship to TIANWEI
up to the full
cumulative balance of Minimum Annual Quantity of Product to be shipped
through
the end of this Contract (an “Excess
Shipment”)
with
TIANWEI’s written consent. This shipment will be credited against each
subsequent Minimum Annual Quantity of Product. For example, if the
Minimum
Annual Quantity of Product for a given Year is [*] metric tons, and
if HOKU
delivers [*] metric tons in January, then the next shipment of [*]
metric tons
is not required until the following Year.
3.2. HOKU
intends to manufacture the Products at its Facility; however, notwithstanding
anything to the contrary herein, HOKU may deliver to TIANWEI Products
that are
manufactured by a third party other than HOKU (“Third
Party Products”),
where
HOKU is acting only as a reseller or distributor of such Products;
and provided
that the Products meet the Product Specifications and price set forth
in this
Agreement; and, provided further, that HOKU shall clearly label all
Third Party
Products and shall remain primarily liable for the acts and omissions
of such
third party producer in failing to meet the Quality Specifications.
HOKU shall
notify TIANWEI in writing prior to the delivery of Third Party
Products.
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3.3. Except
in
the case of a force majeure pursuant to Section 12
below,
if HOKU does not supply any Products pursuant to Section 3.1
or
3.2
within
[*] days of the scheduled delivery date, HOKU will provide TIANWEI
with a
purchase price adjustment. Such purchase price adjustment shall be
[*] percent
([*]) of the value of the respective delayed Products for each week
or part
thereof that the Product shipment (or part thereof) is delayed beyond
the [*]
day grace period. Any
purchase price adjustment as a result of this Section 3.3
will be
immediately creditable by HOKU to the future invoiced price of the
Products to
be paid by TIANWEI commencing upon the date on which the purchase
price
reduction becomes due.
In lieu
of making a cash payment to TIANWEI pursuant to this Section 3.3,
HOKU
may,
at its option, pay for such purchase price adjustment in the form
of a credit
issued for future shipments of Products.
Notwithstanding anything to the contrary, the maximum amount of such
purchase
price adjustment shall not exceed [*] percent ([*]) of the value
of the
respective delayed Products. Monthly shipments which are delayed
beyond [*] days
shall be deemed to constitute a material breach of this Agreement
pursuant to
Section 9.2.1
below.
Notwithstanding the foregoing, if TIANWEI fails to make a payment
to HOKU within
the [*] period set forth in Section 5.6
below,
HOKU shall not be required to supply any Product to TIANWEI until
HOKU has
received the past due amount including any interest payable thereon
pursuant to
this Agreement. For the avoidance of doubt, TIANWEI’s right to reduce the
purchase price pursuant to this Section 3.3
shall
not apply if HOKU is not fulfilling its supply obligations for this
reason.
3.4. HOKU
hereby covenants and agrees that during the term of this Agreement,
and provided
that TIANWEI is not in breach of any material term of this Agreement,
including,
without limitation, its payment obligations hereunder, HOKU shall
not ship any
Products to any third party that is not one of HOKU’s Other Customers (e.g.,
spot market sales), until HOKU has satisfied its delivery obligations
to TIANWEI
pursuant to Section 3.1
of this
Agreement.
4. Shipping
& Delivery.
4.1. Except
as
provided in Section 3.2
above,
shipments shall be made from the Facility on a monthly basis
in accordance with
a shipment schedule that will be provided by HOKU each Year under
this Agreement
(the “Shipment
Schedule”)
no
later than sixty (60) days prior to the applicable Year. The
Shipment Schedule
shall provide for approximately equal monthly shipments that
add up to the
Minimum Annual Quantity of Products.
4.2. HOKU
will
use commercially reasonable efforts to make available to TIANWEI
its first
shipment of Products on or before March 31, 2010.
4.3. In
addition to the Minimum Annual Quantity of Product to be delivered
to TIANWEI
each Year beginning on the First Shipment Date pursuant to this
Agreement, HOKU
shall use commercially reasonable efforts to ship an additional
[*] metric tons
of Products to TIANWEI in calendar year 2009. Any such shipments
shall be
invoiced at [*] U.S. Dollars ([*]) per kilogram pursuant to Section
5.6.
Any
Products sold to TIANWEI pursuant to this Section 4.3
shall be
from HOKU’s excess production output, which means that such Products are
not
required to be shipped pursuant to any of HOKU’s existing commitments to HOKU’s
existing Customers (limited to SANYO Electric Co., Ltd., Suntech
Power Holding
Co., Ltd., Global Expertise Wafer Division, Ltd., Solarfun Power
Hong Kong
Limited, and Jiangxi Kinko Energy Co., Ltd.), and would otherwise
be sold to
other new customers or on the spot market (such unallocated Products,
the
“Spot
Market Products”).
Notwithstanding the foregoing, HOKU shall have no obligation
to ship to TIANWEI
any Products that do not meet (or exceed) the Product
Specifications.
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4.4. In
addition to the Minimum Annual Quantity of Product to be
delivered to TIANWEI
each Year beginning on the First Shipment Date pursuant to
this Agreement, and
in addition to any Products shipped to TIANWEI in calendar
year 2009 pursuant to
Section 4.3
above,
during the months of January and February, 2010, HOKU shall
provide TIANWEI with
a right of first refusal (the “ROFR”)
on up
to an aggregate of [*] metric tons of Spot Market Products
(as defined in
Section 4.3
above).
TIANWEI’s
ROFR on Spot Market Products shall be subject to the conditions
and procedures
set forth in the next sentences of this Section 4.4.
Prior
to any sale of Spot Market Products to a third party, HOKU
shall offer such Spot
Market Products to TIANWEI in writing via facsimile or email
(the “Offer”).
The
Offer
shall include the materials terms of the offer, including
price, volume and
shipping terms. TIANWEI shall provide HOKU with a written
notice of acceptance
of the Offer (the “Acceptance”)
within
[*] after receipt of the Offer. The Acceptance, together
with the Offer, shall
be a firm order which cannot be cancelled by either Party.
The Acceptance may
not change or add to the terms of the Offer, and any such
changes shall be
construed as a rejection of the Offer. If TIANWEI does not
provide the
Acceptance within [*] after receipt of the Offer, or if TIANWEI
rejects the
Offer, then HOKU may sell such Spot Market Products to any
third party. The
foregoing ROFR shall expire on the earliest to occur of (A)
HOKU’s shipment of
an aggregate of [*] metric tons of Spot Market Products to
TIANWEI during the
months of January and February 2010; or (B) February 28,
2010.
5. Payments
& Advances.
5.1. Within
fifteen (15) days after the Effective Date, TIANWEI shall
provide HOKU with a
prepayment of Fifteen Million U.S. Dollars (US$15,000,000)
via wire transfer of
immediately available funds (the “Initial
Deposit”).
5.2. TIANWEI
shall pay in cash to HOKU the additional sum of Fifteen
Million U.S. Dollars
(US$15,000,000) (the “Second
Deposit”)
as an
advance payment for Products to be delivered under this
Agreement. Payment of
the Second Deposit shall be made on or before November
15, 2008.
5.3. TIANWEI
shall pay in cash to HOKU the additional sum of Ten Million
U.S. Dollars
(US$10,000,000) (the “Third
Deposit”)
as an
advance payment for Products to be delivered under this
Agreement. Payment of
the Third Deposit shall be made on or before January 15,
2009.
5.4. TIANWEI
shall pay in cash to HOKU the additional sum of Five Million
U.S. Dollars
(US$5,000,000) (the “Fourth
Deposit”
and
together with the Second Deposit and the Third Deposit,
the “Main
Deposit”)
as an
advance payment for Products to be delivered under this
Agreement. Payment of
the Fourth Deposit shall be made when HOKU completes the
shipment to TIANWEI of
a cumulative aggregate of [*] metric tons of Products pursuant
to Section
4
of this
Agreement (including Products shipped in calendar year
2009).
5.5. Within
thirty (30) days after the Effective Date, TIANWEI shall
provide to HOKU an
irrevocable stand-by letter of credit in substantially
the form of Appendix
3
attached
hereto (the “Letter
of Credit”)
in the
amount of the Main Deposit, with such changes as may be
mutually acceptable to
the Issuing Bank (defined in the next sentence) and HOKU.
The Letter of Credit
shall be issued to HOKU by the Hong Kong branch of China
Construction Bank, or
such other bank that is acceptable to HOKU in its sole
discretion (the
“Issuing
Bank”).
The
Letter of Credit shall be issued in US Dollars for the
full amount of the Main
Deposit, and shall be freely assignable by HOKU in connection
with any
assignment of this Agreement by HOKU pursuant to Section
14.4
below.
Payment to HOKU of the Third Deposit and the Fourth Deposit
shall be made by the
Issuing Bank upon its receipt of written notice that TIANWEI
has failed to make
such payment on the applicable date. The Letter of Credit
shall expire after the
Main Deposit has been paid in full.
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5.6. HOKU
shall invoice TIANWEI at or after the time of each shipment
of Products to
TIANWEI. Taxes, customs and duties, if any, will be identified
as separate items
on HOKU invoices. All invoices shall be sent to TIANWEI’s address as provided
herein. Payment terms for all invoiced amounts shall be
[*] days from date of
shipment. All payments shall be made in U.S. Dollars. Unless
HOKU is entitled to
retain the Total Deposit as liquidated damages pursuant
to Section 11
below,
shipments
to TIANWEI shall be credited against the Total Deposit
on
a
straight-line basis during the second through tenth Year
from the First Shipment
Date.
5.7. The
prices for the Products do not include any excise, sales,
use, import, export or
other similar taxes, such taxes will not include income
taxes or similar taxes,
which taxes will be invoiced to and paid by TIANWEI, provided
that TIANWEI is
legally or contractually obliged to pay such taxes. HOKU
and TIANWEI shall work
together to eliminate the possibility of taxes, but if
there are any assessed,
HOKU shall promptly remit to TIANWEI in full any such taxes
paid by TIANWEI
which are refunded to HOKU in whole or in part. TIANWEI
shall be responsible for
all transportation charges, duties or charges, liabilities
and risks for
shipping and handling (and hereby indemnifies HOKU for
such costs, liabilities
and risks); thus, the price for the Products shall not
include any such
charges.
5.8. Late
payments and outstanding balances shall accrue interest
at the lesser of [*] per
annum or the maximum allowed by law.
6. Security
Interest.
6.1. Subject
to receipt of the Initial Deposit and or payment of any
portion of the Main
Deposit HOKU hereby grants to TIANWEI a security interest
to secure the
repayment by HOKU to TIANWEI of the Total Deposit following
any of the events
set forth in Section 9.5
below,
which shall be subordinated in accordance with Section
6.2
below,
in all of the tangible and intangible assets related
to HOKU’s polysilicon
business (the “Collateral”).
6.2. TIANWEI
acknowledges and agrees that the security interests and
liens in the Collateral
will not be first priority security interests, will be
expressly subordinated to
HOKU’s third-party lenders (the “Senior
Lenders”)
that
provide debt financing for the construction of any HOKU
Facility, and may be
subordinated as a matter of law to other security interests,
and to security
interests that are created and perfected prior to the
security interest granted
to TIANWEI hereby. TIANWEI shall enter into subordination
agreements with the
Senior Lenders on terms and conditions reasonably acceptable
to the Senior
Lenders.
6.3. In
addition, TIANWEI shall enter into collateral, intercreditor
and other
agreements (the “Collateral
Agreements”)
with
HOKU’s Senior Lenders, and with Hoku’s other customers, which may include SANYO
Electric Co., Ltd., Suntech Power Holding Co., Ltd.,
Global Expertise Wafer
Division, Ltd., Solarfun Power Hong Kong Limited, Jiangxi
Kinko Energy Co.,
Ltd., and HOKU’s other customers who provide prepayments for Products
(collectively, “HOKU’s
Other Customers”),
as
may be reasonably necessary to ensure that the security
interest granted hereby
is pari passu with the security interests that may be
granted to HOKU’s Other
Customers. TIANWEI may not unreasonably refuse to sign
any such Collateral
Agreement, provided that such Collateral Agreement grants
TIANWEI a pari passu
priority with respect to HOKU’s Other Customers, and is expressly subordinated
to the Senior Lenders.
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6.4. The
security interest granted hereby shall continue so long as
HOKU continues to
maintain any amount of the Total Deposit, and only to the
extent of such
remaining amount of the Total Deposit being held by HOKU,
which has not been
credited against the shipment of Products pursuant to this
Agreement, or
otherwise repaid to TIANWEI. Notwithstanding anything to
the contrary contained
in this Agreement, the Collateral consisting of real property
shall secure only
the obligations of HOKU to refund any portion of the Total
Deposit to TIANWEI in
accordance with the terms of this Agreement. When the Total
Deposit is no longer
held by HOKU, TIANWEI will sign such documents as are necessary
to release its
security interests.
6.5. HOKU
and
TIANWEI each agree to act in good faith to execute and deliver
any additional
document or documents that may be required in furtherance
of the foregoing
provisions of this Section 6,
including the Collateral Agreements. Neither HOKU nor TIANWEI
may unreasonably
refuse to sign any such document.
7. Product
Quality Guarantee.
7.1. HOKU
warrants to TIANWEI that the Products shall meet the Product
Specifications. For
each shipment, this warranty shall survive for [*] days after
the applicable
shipment date (the “Warranty
Period”).
Upon
release of the Products to a common carrier or freight forwarder,
FOB origin
(INCOTERMS 2000), HOKU warrants that the Products shall be
free of all liens,
mortgages, encumbrances, security interests or other claims
or rights. HOKU
will, upon prompt notification from TIANWEI, and TIANWEI’s compliance with
HOKU’s instructions, refund in full, including all direct costs,
or replace, at
TIANWEI’s sole option and at HOKU’s expense, any Product which does not meet the
Product Specifications, and TIANWEI shall comply with the
inspection and return
goods policy described in Section 8
below
with respect to such Products. No employee, agent or representative
of HOKU has
the authority to bind HOKU to any oral representation or
warranty concerning the
Products. Any oral representation or warranty made prior
to the purchase of any
Product and not set forth in writing and signed by a duly
authorized officer of
HOKU shall not be enforceable by TIANWEI. HOKU makes no warranty
and shall have
no obligation with respect to damage caused by or resulting
from accident,
misuse, neglect or unauthorized alterations to the Products.
7.2. HOKU
EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS,
IMPLIED OR STATUTORY,
INCLUDING THE WARRANTIES OF MERCHANTABILITY, AND FITNESS
FOR A PARTICULAR
PURPOSE. HOKU’s sole responsibility and TIANWEI’s exclusive remedy for any claim
arising out of the purchase of any Product is a refund or
replacement, as
described above. In no event shall HOKU’s liability exceed the purchase price
paid therefor plus the direct expenses associated with the
refund or
replacement; nor shall HOKU be liable for any claims, losses
or damages of any
individual or entity or for lost profits or any special,
indirect, incidental,
consequential, or exemplary damages, howsoever arising, even
if HOKU has been
advised of the possibility of such damages.
7.3. HOKU
shall, at its own expense, indemnify and hold TIANWEI and
its Affiliates
harmless from and against any expense or loss resulting from
any actual or
alleged infringement of any patent, trademark, trade secret,
copyright, mask
work or other intellectual property related to the Products,
and shall defend at
its own expense, including attorneys fees, any suit brought
against TIANWEI or
TIANWEI’s Affiliates alleging any such infringement. TIANWEI agrees
that: (i)
TIANWEI shall give HOKU prompt notice in writing of any such
suit; (ii) if HOKU
provides evidence reasonably satisfactory to TIANWEI of HOKU’s financial ability
to defend the matter vigorously and pay any reasonably foreseeable
damages,
TIANWEI shall permit HOKU, through counsel of HOKU’s choice, to answer the
charge of infringement and defend such suit (but TIANWEI,
or TIANWEI’s Affiliate
may be represented by counsel and participate in the defense
at its own
expense); and (iii) TIANWEI shall give HOKU all needed information,
assistance,
and authority, at HOKU’s expense, to enable HOKU to defend such suit. In case of
a final award of damages in any such suit HOKU shall pay
such award, but shall
not be responsible for any settlement made without its prior
consent. Except as
otherwise expressly set forth herein, HOKU disclaims any
obligation to defend or
indemnify TIANWEI, its officers, agents, or employees, from
any losses, damages,
liabilities, costs or expenses which may arise out of the
acts of omissions of
HOKU.
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8. Inspection
and Return Goods Policy.
8.1. An
inspection of appearance of each shipment of Product shall
be made by TIANWEI in
accordance with sound business practice upon the delivery
of the Product, and in
no case later than [*] weeks after delivery at TIANWEI’s factory. TIANWEI shall
inform HOKU promptly, and in no case later than [*] weeks
after delivery of
Product, in case of any obvious damages or other obvious
defects to the Product
which TIANWEI discovers under the inspection of appearance.
All
Products shall be double-packaged in polyethylene bags suitable
for maintaining
the quality of the Products and for long-distance overseas
shipping, which will
be weighed and bar-coded for tracking purposes prior to shipment.
8.2. TIANWEI
shall perform final inspection of the Product upon introducing
the Product into
TIANWEI’s production process. Such inspection shall take place during
the
Warranty Period. If the Product does not meet the Product
Specifications,
TIANWEI shall notify HOKU in writing without undue delay
after the inspection
and, together with the notification, submit documentary evidence
of the result
of the final inspection whereupon HOKU shall have the right
to undertake its own
inspection prior to any return of the Products pursuant to
Section 8.3
below.
HOKU is
required to acknowledge TIANWEI’s notification within [*] business days and
provide an action plan within [*] business days thereafter
to solve the issue.
If no such action plan is received by TIANWEI within [*],
it shall be deemed
that HOKU has accepted the returned Products. HOKU reserves
the right to reverse
any credit issued to TIANWEI if, upon return, such Product
is determined by an
Independent Expert not to be defective. The conclusion of
the Independent Expert
shall be final, binding and non-appealable in respect of
the conformity of the
Products to the warranties set forth in Section 7.1
above.
The fees and expenses of the Independent Expert shall be
paid solely by the
party that does not succeed in the dispute.
8.3. Products
may be returned to HOKU within the later of (a) [*] days
after discovery of a
defect consistent with Sections 8.1
and
8.2
above;
and (b) [*] days after HOKU completes its inspection and
confirms the defect
pursuant to Section 8.2
above,
for replacement or a refund including all other direct expenses.
To assure
prompt handling, HOKU shall provide TIANWEI a return goods
authorization number
within [*] hours of TIANWEI’s request. Provided that HOKU communicates this
number to TIANWEI within such timeframe, TIANWEI will reference
this number on
return shipping documents. Returns made without the authorization
number
provided by HOKU in accordance with the foregoing may be
subject to HOKU’s
reasonable charges due to HOKU’s additional handling costs.
9. Term
and Termination.
9.1. The
term
of this Agreement shall begin on the Effective Date and provided
that the first
delivery of the Product under this Agreement shall occur
on March 31, 2010, or
earlier, and unless previously terminated as hereinafter
set forth, shall remain
in force for a period of ten Years beginning with the First
Shipment Date.
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20
Exhibit
10.82
CONFIDENTIAL
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 [*] days
after written notice thereof;
provided, however, that such cure period shall not modify
or extend the [*] cure
period for HOKU’s delivery obligations pursuant to Section 3.3
above;
and provided, further that such [*] day cure period shall
not apply to TIANWEI’s
failure to make any payment to HOKU pursuant to this Agreement.
In the event of
TIANWEI’s failure to make payment on the [*] payment terms set
forth in Section
5.6
hereof,
termination by HOKU 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 [*] business days.
For
purposes of this Section 9.2.1,
a
“material breach” means a monthly shipment which is delayed beyond [*] days,
a
payment default or any other material breach of this Agreement
which materially
and adversely affects a Party or which occurs on multiple
occasions.
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 [*]
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 12
(Force
Majeure) below; provided, however, that TIANWEI may not
terminate this Agreement
pursuant to Section 12
if HOKU
is supplying Products to TIANWEI pursuant to Section 3.2
of this
Agreement.
9.2.5. Without
limiting the foregoing, TIANWEI shall have the right to
terminate this Agreement
if (A) HOKU does not deliver the Officer’s Certificate pursuant to Section
13.3
below by
the date specified therein, or (B) the First Shipment Date
does not occur on or
before March 31, 2010.
9.3. HOKU
shall have the right to terminate this Agreement if (A)
on or before the
fifteenth (15th) calendar day after the Effective Date,
TIANWEI has failed to
pay the Initial Deposit; (B) on or before the thirtieth
(30th)
day
after the Effective Date, TIANWEI has failed to provide
the Standby Letter of
Credit, in which case, HOKU shall be entitled to retain
the Initial Deposit as
liquidated damages; (C) on or before November 15, 2008,
TIANWEI and the Issuing
Bank have failed to pay the Second Deposit, in which case
HOKU shall retain the
Initial Deposit as liquidated damages; (D) on or before
January 15, 2009,
TIANWEI and the Issuing Bank have failed to pay the Third
Deposit, in which case
HOKU shall retain the Initial Deposit and the Second Deposit
as liquidated
damages; or (E)
TIANWEI
and the Issuing Bank have failed to pay the Fourth Deposit
in accordance with
Section 5.4
of this
Agreement, in which case HOKU shall retain the Initial
Deposit, the Second
Deposit and the Third Deposit as liquidated damages.
9.4. Upon
the
expiration or termination of this Agreement howsoever arising,
the following
Sections shall survive such expiration or termination:
Sections 1
(Definitions); Section 7
(Product
Quality Guarantee), Section 8
(Inspection and Return Goods Policy); Section 9
(Term
and Termination); Section 10
(Liability); Section 11
(Liquidated Damages); and Section 14
(General
Provisions).
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
8 of
20
Exhibit
10.82
CONFIDENTIAL
9.5. If
TIANWEI terminates this Agreement pursuant to Section 9.2.1,
9.2.2,
9.2.3,
9.2.4,
9.2.5
or
12
then any
funds remaining on the Total Deposit on such date of termination
shall be
returned to TIANWEI; provided however that if TIANWEI is
in material breach of
this Agreement at the time it terminates this Agreement,
then HOKU shall not be
required to repay any remaining amount of the Total Deposit
up to the amounts of
HOKU’s direct loss from such material breach (unless TIANWEI
cures such breach
within the applicable cure period) or TIANWEI’s other outstanding and unpaid
obligations hereunder (including, without limitation, obligations
under Section
11).
9.6. If
HOKU
terminates this Agreement pursuant to Section 9.2.1,
9.2.2,
9.2.3,
9.2.4,
or
12
then
HOKU shall be entitled to retain the Total Deposit including
any funds remaining
on the Total Deposit on such date of termination in accordance
with Section
11.
“Funds
remaining”
on
the
Total Deposit are funds not applied against TIANWEI’s purchase of Product,
pursuant to Section 5.6
above,
for Product actually shipped to TIANWEI hereunder.
9.7. If
TIANWEI terminates this Agreement pursuant to Section 9.2.1
due to
HOKU’s breach of Section 3.4,
then
[*]% of the funds remaining on the Total Deposit on such
date of termination
shall be returned to TIANWEI within [*] calendar days,
with any late payment
accruing interest pursuant to Section 5.8
above;
provided however that if TIANWEI is in material breach
of this Agreement at the
time it terminates this Agreement, then HOKU shall not
be required to repay any
portion of the Total Deposit up to the amounts of HOKU’s direct loss from such
material breach (unless TIANWEI cures such breach within
the applicable cure
period) or TIANWEI’s other outstanding and unpaid obligations hereunder
(including, without limitation, obligations under Section
11).
10. Liability.
10.1. IN
NO
EVENT SHALL EITHER PARTY BE LIABLE FOR INDIRECT, SPECIAL,
INCIDENTAL OR
CONSEQUENTIAL DAMAGES OR FOR EXEMPLARY OR PUNITIVE DAMAGES,
EVEN IF TIANWEI OR
HOKU HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
10.2. 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 TOTAL DEPOSIT,
EXCEPT (A) WITH
RESPECT TO TIANWEI’S CONTINUING OBLIGATION TO PURCHASE THE PRODUCTS AS SET
FORTH
HEREIN, AND (B) HOKU’S OBLIGATION TO PAY [*]% OF THE FUNDS REMAINING ON THE
TOTAL DEPOSIT PURSUANT TO SECTION 9.7
ABOVE.
11. Liquidated
Damages.
11.1. THE
PARTIES ACKNOWLEDGE AND AGREE THAT ANY BREACH OF THIS AGREEMENT
BY TIANWEI MAY
CAUSE IRREPARABLE AND IMMEASURABLE DAMAGE TO HOKU. BECAUSE
IT IS DIFFICULT TO
MEASURE THESE DAMAGES, IN THE EVENT THAT THIS AGREEMENT
IS TERMINATED BY HOKU
PURSUANT TO SECTION 9.2.1,
9.2.2,
9.2.3,
9.2.4,
9.3
or
12,
THEN
HOKU SHALL BE ENTITLED TO RETAIN AS LIQUIDATED DAMAGES,
THE TOTAL DEPOSIT
(INCLUDING ANY REMAINING PORTION THEREOF NOT CREDITED AGAINST
PRODUCT
SHIPMENTS). ANY AMOUNTS DUE FOR UNDELIVERED PRODUCT UNDER
THIS AGREEMENT ARE
STILL DUE, UNLESS OTHERWISE AGREED BY BOTH PARTIES IN WRITING.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
9 of
20
Exhibit
10.82
CONFIDENTIAL
11.2. THE
PARTIES ACKNOWLEDGE AND AGREE THAT ANY BREACH OF SECTION
3.4
OF THIS
AGREEMENT BY HOKU MAY CAUSE IRREPERABLE AND IMMEASURABLE
DAMAGE TO TIANWEI.
BECAUSE IT IS DIFFICULT TO MEASURE THESE DAMAGES, IN THE
EVENT THAT THIS
AGREEMENT IS TERMINATED BY TIANWEI PURSUANT TO SECTION
9.2.1
DUE TO
HOKU’S BREACH OF SECTION 3.4,
THEN
HOKU SHALL BE OBLIGATED TO PAY AS LIQUIDATED DAMAGES, [*]%
OF THE FUNDS
REMAINING ON THE TOTAL DEPOSIT.
12. 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 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, then the non-affected Party shall be entitled
to terminate this
Agreement by 30 days’ prior written notice to the other Party. For
the
purposes of this Section 12,
the
inability of TIANWEI to receive, accept or take delivery
of Products that have
been made available by HOKU pursuant to this Agreement
shall not constitute an
event of force majeure.
13. Visitation
Rights; Certifications.
13.1. Beginning
on the date when HOKU receives the Initial Deposit, and
until the First Shipment
Date or the earlier termination of this Agreement pursuant
to Section
9
above,
TIANWEI shall have the right to visit the HOKU Facility
in Pocatello, Idaho,
USA, for the limited purpose of evaluating HOKU’s progress towards completing
the construction of its polysilicon production facilities.
TIANWEI shall provide
HOKU with at least [*] days’ prior notice of any such visit, and may not visit
more than two times each calendar quarter. HOKU reserves
the right to refuse
access to any individual who is not subject to HOKU’s non-disclosure agreement.
TIANWEI shall agree to abide by all of HOKU’s safety and security requirements
and instructions for the HOKU Facility.
13.2. Beginning
on the date when HOKU receives the Initial Deposit, and
until the First Shipment
Date or the earlier termination of this Agreement pursuant
to Section
9
above,
HOKU shall provide TIANWEI with monthly updates on the
progress of the
construction of the HOKU polysilicon production facilities,
including, without
limitation, an explanation of any potential delays in meeting
its shipment
obligations to TIANWEI.
13.3. At
any
time prior to November 1, 2008, HOKU shall deliver to TIANWEI
a signed officer’s
certificate in substantially the form of Appendix
4
attached
to this Agreement (the “Officer’s
Certificate”).
14. General
Provisions.
14.1. TIANWEI
acknowledges that it is the policy of HOKU to scrupulously
comply with the
Foreign Corrupt Practices Act of 1977 (as amended, the
“FCPA”)
and to
adopt appropriate and reasonable practices and procedures
that are undertaken in
such a manner as to substantially eliminate the potential
for violation of the
FCPA. TIANWEI further acknowledges that it shall be bound
by any law, regulation
or other legal enactment, that prohibits corrupt practices
of the type or nature
described in the FCPA and that is applicable to TIANWEI,
and TIANWEI hereby
represents and warrants that neither HOKU, nor to TIANWEI’s knowledge, any other
authorized person or entity associated with or acting for
or on behalf of HOKU,
has knowingly directly or indirectly made any contribution,
gift, bribe, rebate,
payoff, influence payment, kickback, or other payment to
TIANWEI, whether in
money, property, or services (i) to obtain favorable treatment
in securing
business from TIANWEI, (ii) to pay for favorable treatment
for business secured
from TIANWEI, or (iii) to obtain special concessions or
for special concessions
already obtained from TIANWEI, for or in respect of HOKU,
in violation of any
legal requirement or applicable law.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
10
of 20
Exhibit
10.82
CONFIDENTIAL
14.2. This
Agreement shall be construed under and governed by the
laws of the State of
California, U.S.A.
14.3. Upon
notice from one Party to the other of a dispute hereunder,
the Parties agree to
hold a meeting within [*] days of receipt of such notice
with at least one (1)
representative from each Party who has decision-making
authority for such
company. At this meeting, the Parties will attempt to resolve
the dispute in
good faith. If, after the meeting, the dispute has not
been resolved, only then
may a Party resort to litigation. Any proceeding to enforce
or to resolve
disputes relating to this Agreement shall be brought in
California, USA. In any
such proceeding, neither Party shall assert that such a
court lacks jurisdiction
over it or the subject matter of the proceeding.
14.4. HOKU
may
assign this Agreement to any of its Affiliates, and may
assign its rights under
this Agreement to any collateral agent as collateral security
for HOKU’s secured
obligations in connection with the financing of a HOKU
Facility, without the
consent of TIANWEI. Except as stated in the previous sentence,
neither HOKU nor
TIANWEI may assign this Agreement to a third party without
the prior written
consent of the other Party, which consent shall not be
unreasonably withheld.
Notwithstanding the foregoing, an assignment of this Agreement
by either Party
in connection with a merger, acquisition, or sale of all
or substantially all of
the assets or capital stock of such Party shall not require
the consent of the
other Party. If this Agreement is assigned effectively
to a third party, this
Agreement shall bind upon successors and assigns of the
Parties
hereto.
14.5. All
notices delivered pursuant to this Agreement shall be in
writing and in the
English language. Except as provided elsewhere in this
Agreement, a notice is
effective only if the Party giving or making the notice
has complied with this
Section 14.5
and if
the addressee has received the notice. A notice is deemed
to have been received
as follows:
|
(a)
|
If
a notice is delivered in person, or sent by registered
or certified mail,
or nationally or internationally recognized overnight
courier, upon
receipt as indicated by the date on the signed
receipt;
or
|
|
(b)
|
If
a notice is sent by facsimile, upon receipt by
the Party giving the notice
of an acknowledgment or transmission report generated
by the machine from
which the facsimile was sent indicating that
the facsimile was sent in its
entirety to the addressee’s facsimile number.
|
Each
Party giving a notice shall address the notice to the appropriate
person at the
receiving Party at the address listed below or to a changed
address as the Party
shall have specified by prior written notice:
TIANWEI:
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
11
of 20
Exhibit
10.82
CONFIDENTIAL
TIANWEI
NEW ENERGY (CHENGDU) WAFER CO., LTD.
Road
8,
Southwest Airport Economical Development Zone Chengdu,
China (Postal
610200)
Tel:
[*]
Fax:
[*]
Attn:
[*]
With
a
copy to:
SINOTRANSPACIFIC
POLY LLC
00000
XxxXxxxxx Xxxx. Xxxxx 000
Xxxxxx,
XX 00000
Tel:
[*]
Fax:
[*]
Attn:
[*]
HOKU:
HOKU
MATERIALS, INC.
0000
Xxxxxxxxx Xxxxxx
Xxxxxxx,
XX 00000
Attn:
Xx.
Xxxxxx Xxxxxx, CEO
Facsimile:
[*]
14.6. The
waiver by either Party of the remedy for the other Party’s breach of or its
right under this Agreement will not constitute a waiver
of the remedy for any
other similar or subsequent breach or right.
14.7. If
any
provision of this Agreement is or becomes, at any time
or for any reason,
unenforceable or invalid, no other provision of this
Agreement shall be affected
thereby, and the remaining provisions of this Agreement
shall continue with the
same force and effect as if such unenforceable or invalid
provisions had not
been inserted in this Agreement.
14.8. No
changes, modifications or alterations to this Agreement
shall be valid unless
reduced to writing and duly signed by respective authorized
representatives of
the Parties.
14.9. No
employment, agency, trust, partnership or joint venture
is created by, or shall
be founded upon, this Agreement. Each Party further acknowledges
that neither it
nor any Party acting on its behalf shall have any right,
power or authority,
implied or express, to obligate the other Party in any
way.
14.10. 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 the Parties will work together to issue
a joint press release
within two (2) days after execution of this Agreement.
Notwithstanding the
foregoing, 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
pricing and technical
information set forth in this Agreement.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
12
of 20
Exhibit
10.82
CONFIDENTIAL
14.11. This
Agreement constitutes the entire agreement between
the Parties and supersedes
all prior proposal(s) and discussions, relative to
the subject matter of this
Agreement and neither of the Parties shall be bound
by any conditions,
definitions, warranties, understandings or representations
with respect to such
subject matter other than as expressly provided herein.
No oral explanation or
oral information by either Party hereto shall alter
the meaning or
interpretation of this Agreement.
14.12. The
headings are inserted for convenience of reference
and shall not affect the
interpretation and or construction of this Agreement.
14.13. Words
expressed in the singular include the plural and vice-versa.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Page
13
of 20
Exhibit
10.82
CONFIDENTIAL
IN
WITNESS WHEREOF, the Parties have executed this Supply
Agreement as of the date
last set forth below.
|
TIANWEI:
TIANWEI
NEW ENERGY (CHENGDU) WAFER CO., LTD.
By: /s/
XXXXX XXX
Name: Xxxxx
Xxx
Title: General
Manager
Authorized
Signatory
Date: August
4, 2008
|
HOKU:
HOKU
MATERIALS, INC.
By: /s/
XXXXXX XXXXXX
Name: Xxxxxx
Xxxxxx
Title: Chairman
& CEO
Authorized
Signatory
Date: August
4, 2008
|
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Signature
Page to Supply Agreement
Page
14
of 20
Exhibit
10.82
CONFIDENTIAL
Appendix
1
Pricing
Schedule
|
Yr
1
|
Yr
2
|
Yr
3
|
Yr
4
|
Yr
5
|
Yr
6
|
Yr
7
|
Yr
8
|
Yr
9
|
Yr
10
|
Total
|
|
|
Tons
per Year
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
Price
per kg
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
[*]
|
|
If
there
is uncertainty in price between the delivery period
and the total quantity for
that period based on the table above, the price
assigned to the quantity shall
prevail. For example, the first [*]
MT shall
be invoiced at [*] per kilogram; provided, however
that if any Products are
shipped in 2009 pursuant to Section 4.3,
then
the price for such Products shall be [*]
per
kilogram.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix 1to
Supply Agreement
Page
15
of 20
Exhibit
10.82
CONFIDENTIAL
Appendix
2 -- Product
Specifications
[*]
Product
Specifications shall be tested in accordance
with the following procedures:
graphite furnace atomic absorption spectroscopy,
inductively coupled plasma-mass
spectroscopy and Fourier transform infrared absorption
spectroscopy.
Qualified
Laboratories:
[*]
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix 2
to Supply Agreement
Page
16
of 20
Exhibit
10.82
CONFIDENTIAL
APPENDIX
3
Form
of
Letter of Credit
[The
final Letter of Credit issued to HOKU is subject
to review and approval by the
Issuing Bank and HOKU, which approval will
not be unreasonably
withheld.]
IRREVOCABLE
STANDBY LETTER OF CREDIT
|
BENEFICIARY:
|
ADVISING
BANK:
|
|
HOKU
MATERIALS, INC.
|
[INSERT
ADVISING BANK NAME]
|
|
ONE
HOKU WAY
|
[INSERT
BANK ADDRESS]
|
|
XXXXXXXXX,
XXXXX 00000
|
Gentlemen:
We
hereby
establish in your favor our Irrevocable Standby
Letter of Credit
No.______________, available by your drafts
at sight on (ISSUING BANK’S NAME) )
for the account of _______________, up to an
aggregate amount of Thirty Million
U.S. Dollars (US$30,000,000).
Alternatively,
electronic drawings may be made by authenticated
Swift indicating the amount
drawn and stating “Drawn under Credit No. ___________ of (ISSUING
BANK’S NAME
AND ADDRESS) dated _______, 2008.
Multiple
presentations permitted.
All
drafts must bear or be electronic drawings
with the clause "Drawn under Credit
No. ___________ of (ISSUING BANK’S NAME) dated __________, 2008."
This
Letter of Credit is subject to an automatic
extension, without a written
amendment, to extend the expiration date for
an additional period of one year
from the present or each future expiration
date unless at least thirty (30) days
prior to any expiration date we notify you
in writing by certified or registered
mail or other similarly expeditious receipted
service at the above address that
this Letter of Credit will not be extended
for any such additional period. Upon
receipt by you of such notice, you may draw
hereunder on or before the then
relevant expiration date by means of your draft
on us at sight or alternatively,
by electronic drawings as mentioned above.
Any
and
all banking charges are for the account of
the applicant.
Pursuant
to U.S. Law, we are prohibited from issuing,
transferring, accepting or paying
letters of credit to any party or entity identified
on the Office of Foreign
Asset Control, U.S. Department of Treasury
list or subject to the denial of
export privileges by the U.S. Department of
Commerce.
This
Credit is issued subject to the International
Standby Practices 1998 (ISP98),
International Chamber of Commerce Publication
No. 590.
It
is a
condition of this letter of credit that it
is transferable and may be
transferred in its entirety, but not in part,
and may be successively
transferred by you or any transferee hereunder
to a successor transferee(s).
Transfer under this letter of credit to such
transferee must be jointly signed
by Beneficiary and shall be effected upon presentation
to us of the original of
this letter of credit and any amendments hereto
accompanied by a request
designating the transferee in the form of Annex
A, attached hereto,
appropriately completed.
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix
3 to Supply Agreement
Page
17
of 20
Exhibit
10.82
CONFIDENTIAL
We
hereby
engage with you that all drawings under and
in compliance with the terms and
conditions of this Credit shall be duly honored
if drawn and presented on or
before June 30, 2010, the expiration date,
or any extended date as provided
above, at (ISSUING BANK’S NAME AND ADDRESS).
|
Sincerely,
|
||
|
|
|
|
|
Authorized
Signature
|
Authorized
Signature
|
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix
3 to Supply Agreement
Page
18
of 20
Exhibit
10.82
CONFIDENTIAL
ANNEX
A
Transfer
of Letter of Credit
[Date]
Delivered
under [insert Bank name],
Irrevocable
Standby Letter of Credit No. [_____],
dated
[__________].
[_______________]
[_______________]
[_______________]
Attention:
[_______________]
Ladies
and Gentlemen:
Reference
is made to [insert Bank name], Irrevocable
Standby Letter of Credit No. [_____]
dated [_______] (the “Letter of Credit”), issued by you in favor of us. Any
capitalized terms used, but not defined,
herein shall have its respective
meaning as set forth in the Letter of Credit.
For
value
received, the undersigned, as Beneficiary
under the Letter of Credit, hereby
irrevocably assigns and transfers to [__________]
(the “Transferee”) all rights
of the undersigned to draw under the Letter
of Credit in their
entirety.
By
this
transfer, all rights of the undersigned,
as Beneficiary under the Letter of
Credit, are transferred to the Transferee,
and the Transferee shall have the
sole rights with respect to the Letter
of Credit relating to any amendments
thereof and any notices thereunder. All
amendments to the Letter of Credit are
to be consented to by the Transferee without
necessity of any consent of or
notice to the undersigned.
Simultaneously
with the delivery of this notice to you,
copies of this notice are being
transmitted to the Transferee.
The
Letter of Credit is returned herewith,
and we ask you to either issue a
substitute letter of credit for the benefit
of the Transferee or endorse the
transfer on the reverse thereof, and forward
it directly to the Transferee with
your customary notice of transfer.
Yours
faithfully
(Authorized
Signatory)
For
[BENEFICIARY]
ACKNOWLEDGED:
(Authorized
Signatory)
For
[SUCCESSOR
BENEFICIARY]
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix
3 to Supply Agreement
Page
19
of 20
Exhibit
10.82
CONFIDENTIAL
APPENDIX
4
Officer’s
Certificate
TO: TIANWEI
NEW ENERGY (CHENGDU) WAFER CO., LTD.
This
officer’s certificate (this “Certificate”)
is
being delivered by Hoku Materials, Inc.
(“HOKU”),
to
Tianwei New Energy (Chengdu) Wafer Co.,
Ltd. (“TIANWEI”),
pursuant to Section 13.3
of that
certain Supply Agreement dated as of
August __, 2008, by and between HOKU
and
TIANWEI (the “Supply
Agreement”).
Capitalized terms not otherwise defined
in this Certificate are defined in the
Supply Agreement.
On
behalf
of HOKU, the undersigned hereby certifies
that as of the date hereof, the
aggregate of all of HOKU’s binding polysilicon sales commitments
(including the
Supply Agreement) do not exceed the rated
monthly production capacity of all
polysilicon reactors ordered for, or
installed at, HOKU Facilities, as certified
by the manufacturer thereof. Subject
to the foregoing, this certification
shall
not apply to (A) supply contracts for
additional capacity from Facility
expansion, including pre-sales of potential
Facility expansions, or from
increased productivity of the Reactors,
or (B) entering into long-term contracts
for the sale of polysilicon that does
not meet the Product
Specifications.
By:
________________________________
Xxxxxx
Xxxxxx,
Chief
Executive Officer
Date:
______________________________
|
TIANWEI
Initials & Date XX
Xxxxxx 0, 0000
|
XXXX
Initials & Date DS
August 4, 2008
|
Appendix
3 to Supply Agreement
Page
20
of 20
