Amendment No. 4 to Second Amended & Restated Supply Agreement
Exhibit 10.56
[*]
= CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED FROM PUBLIC FILING PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT SUBMITTED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION.
THE OMITTED INFORMATION, WHICH HAS BEEN IDENTIFIED WITH THE SYMBOL “[*],” HAS
BEEN FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
Amendment
No. 4 to
Second
Amended & Restated Supply Agreement
This
Amendment No. 4 to Second Amended & Restated Supply Agreement (this “Amendment”)
is entered into as of the last date set forth on the signature page hereto, by
and between Hoku Materials, Inc., a Delaware corporation (“HOKU”),
and Solarfun Power Hong Kong Limited, a company registered in Hong Kong (“SOLARFUN”). HOKU
and SOLARFUN are each a “Party” and together the “Parties” to this
Amendment.
Recitals
Whereas,
HOKU and SOLARFUN are Parties to that certain Second Amended & Restated
Supply Agreement dated as of May 13, 2008, (the “Supply Agreement”) as amended
by that certain Amendment No. 1 to Second Amended & Restated Supply
Agreement dated as of October 22, 2008, that certain Amendment No. 2 to Second
Amended & Restated Supply Agreement dated as of March 26, 2009, and that
certain Amendment No. 3 to Second Amended & Restated Supply Agreement dated
as of November 15, 2009 (collectively, the “Agreement”);
Whereas,
SOLARFUN has paid $45 million to HOKU as a prepayment for future Product
shipments pursuant to the Agreement;
Whereas,
the Parties desire to make certain amendments to the Agreement as hereinafter
set forth; and
Whereas,
each Party derives a benefit from the amendments set forth herein.
Now
therefore, in consideration of the foregoing, and for other good and valuable
consideration, the receipt of which is hereby acknowledged by the Parties, the
Parties agree to amend the Agreement as set forth below.
Agreement
1. Effectiveness. This
Amendment shall become effective upon HOKU’s receipt of Four Million U.S.
Dollars (USD $4,000,000.00) pursuant to Section 5.2.2 of the
Agreement. Solarfun will process the payment as soon as
possible. If such payment is not received on or before March 1, 2010,
then this Amendment shall be voidable at HOKU’s sole and absolute
discretion. In the event that this Amendment is voided by HOKU, then
the Agreement shall continue in full force and effect.
2. Definitions. All
capitalized terms not otherwise defined are defined in the
Agreement.
3. Amendment of Section
3.3. The reference to March 31, 2010 in Section 3.3 of the
Agreement (as amended by Amendment No. 2) is hereby changed to September 30,
2010.
4. Amendment of Section
3.4. Section 3.4 of the Agreement is hereby deleted in its
entirety, and replaced with the following:
3.4. [Reserved].
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5. Amendment of Section
4.3. The reference to January 1, 2010 in Section 4.3 of the
Agreement (as amended by Amendment No. 2) is hereby changed to July 1,
2010.
6. Amendment of Section
5.2.3. Section 5.2.3 of the Agreement is hereby amended and
restated to read as follows:
5.2.3 Six
Million U.S. Dollars (USD $6,000,000.00) of the Main Deposit (the “Fourth
Deposit”) shall be paid to Hoku in accordance with the following
schedule:
(a) One Million Five Hundred Thousand
U.S. Dollars (USD $1,500,000.00) of the Main Deposit shall be paid to HOKU on
the First Shipment Date.
(b) One Million Five Hundred
Thousand U.S. Dollars (USD $1,500,000.00) of the Main Deposit shall be paid to
HOKU one month after the First Shipment Date. with each such portion of the
Fourth Deposit being invoiced separately on the date of shipment, and being
payable to HOKU within fifteen (15) calendar days after receipt of the
applicable invoice (the “Fourth Deposit
Date”).
(c) Three Million U.S.
Dollars (USD $3,000,000.00) of the Main Deposit shall be paid to HOKU three
months after the First Shipment Date.
(d) For
purposes of triggering the release of any portion of the Fourth Deposit pursuant
to Subsection (a), (b), or (c) above, HOKU must ship Product to SOLARFUN that is
manufactured by HOKU at HOKU’s Facility.
7. Reduction in
Pricing.
7.1. Subject
to the effectiveness of this Amendment, pursuant to Section 1 above, the price per kilogram of Products
to be shipped during the first Year of the Agreement shall be reduced to
[*].
7.2. Effective
only upon HOKU’s receipt in full of the Fourth Deposit pursuant to Section 5.2.3
(c) of the Agreement (as added by Section 6 above), the price per kilogram of
Products to be shipped during the second Year of the Agreement shall be reduced
to [*].
For the
avoidance of doubt, in the event that SOLARFUN fails to make any payment when
due pursuant to Section 5.2.3 of the Agreement, in addition to any other rights
and remedies that HOKU may pursue pursuant to the Agreement, the pricing
reduction shall not be effective, and the pricing on Appendix 1 of the Agreement
shall continue to be in effect.
8. Increase in Term and
Volume. Subject to the effectiveness of the reduction in
pricing pursuant to Section 7 above,
HOKU and SOLARFUN agree to add one additional Year to the term of the Agreement,
such that the term is increased to eleven (11) Years. The aggregate
volume to be shipped to SOLARFUN during the eleventh Year is [*] metric tons,
and the price per kilogram of Product delivered during such Year shall be [*],
or the price as determined according to the quarterly business reviews per
Section 11 below.
9. Amendment of Section
9.1. The reference to June 30, 2010 in Section 9.1 of the
Agreement (as amended by Amendment No. 2) is hereby changed to December 31,
2010.
10. Amendment of Section
9.2.5. The reference to June 30, 2010 in Section 9.2.5 of the
Agreement (as amended by Amendment No. 2) is hereby changed to December 31,
2010.
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11. Semi-Annual / Quarterly
Business Reviews. Starting on September 30, 2010 and for the
following two years, HOKU and SOLARFUN will hold semi-annual business reviews to
discuss current market conditions, each company’s business plans and finances,
and other relevant issues, such as current developments in market pricing and
the difference between the current market price and the contract
price. From the third year until the end of the contract, these
reviews will be held on a quarterly basis. These reviews will be held
with the intention of assuring that each company is supporting the other as a
long-term customer or supplier, as applicable.
12. Time & Location for
Performance. All dates and times set forth in this Amendment
shall be the day and time in New York, USA.
13. Integration &
Survival. Except for the amendments specifically set forth
above, the terms of the Agreement shall continue in full force and effect mutatis
mutandis. This Amendment and the Agreement constitute the
entire agreement between the Parties concerning the subject matter
hereof.
14. Miscellaneous. Except
where the terms of this Amendment conflict with the Agreement, the “General
Provisions” set forth in Section 13 of the Agreement, including, without
limitation, provisions concerning the choice of law and means for dispute
resolution between HOKU and SOLARFUN, shall apply to this
Amendment. In the event of any conflict between the terms of this
Amendment and the Agreement, the terms of this Amendment shall
control.
IN
WITNESS WHEREOF, the Parties have executed this Amendment No. 4 to Second
Amended & Restated Supply Agreement as of the last date set forth
below.
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SOLARFUN:
SOLARFUN
POWER HONG KONG LIMITED
By:
/s/ Ping Xxxxx Xxx
Name: Ping Xxxxx Xxx
Title: President
Date: Xxxxx 0, 0000
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XXXX:
HOKU
MATERIALS, INC.
By: /s/ Xxxxx Xxxx
Name: Xxxxx Xxxx
Title: Chief Operating Officer
Date: March 1, 2010
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