Hoku Materials, Inc., a subsidiary of Hoku Scientific, Inc., has announced an amendment to the polysilicon supply agreement with Wealthy Rise International, Ltd., a subsidiary of Solargiga Energy Holdings, Ltd., which would reduce the total volume of polysilicon sold to Wealthy Rise by up to US$136 million over 10 years.
In addition, the amended contract alters when Hoku is required to begin shipping polysilicon until June 30, 2010. Wealthy Rise is able to terminate the agreement if Hoku has not begun making shipments by October 31, 2010, while Hoku can terminate the agreement if Wealthy Rise does not make its payment in time.
Wealthy Rise has given an initial deposit of US$7 million. Additional deposits are required in June, August, October and December of this year. Each of these will be US$3.3 million, while a final payment of US$200,000 will be made after the first shipment is received. Hoku will also provide a security interest to Wealthy Rise in the company’s polysilicon assets. This gives Hoku a chance to repay US$20.4 million as a credit against product shipments over a period.
Hoku has recently amended its contract with Jinko in addition to announcing a new 10-year polysilicon supply agreement with Shanghai Alex New Energy Company, Ltd.