Hoku Receives $50 Million From Tianwei Loan to Finance Polysilicon Plant

Submitted by orville on March 9, 2010
in

Hoku Materials, Inc., a wholly-owned subsidiary of Hoku Scientific, Inc. (NASDAQ: HOKU), established to manufacture and sell polysilicon for the solar market, today announced that it received the second tranche of $30 million for a total loan amount of $50 million from Tianwei New Energy Holdings Co., Ltd., a leading provider of silicon wafers, photovoltaic (PV) cells, modules and systems. Hoku also confirmed receipt of $4 million in polysilicon prepayments on March 1, 2010, from Solarfun Power Hong Kong Limited, pursuant to its polysilicon sales agreement with Hoku.

Hoku reported that the aggregate cash proceeds of $54 million will be used to pay down past due vendor balances and liens, and to continue engineering, procurement, and construction activities at its polysilicon plant in Pocatello, Idaho.

Hoku had expected Tianwei to provide the second tranche of $30 million as agreed no later than February 22, 2010, and as a result it planned to achieve its reactor demonstration in March 2010. Receipt of the funds was delayed two weeks due to the Chinese government's process for approving foreign currency transactions, and Hoku is now reporting that it expects to complete the reactor demonstration in April 2010.

"We are pleased that with the receipt of recent cash payments we are able to focus on completing our reactor demonstration in the weeks ahead," said Dustin Shindo, chairman and chief executive officer of Hoku Scientific. "This is a big step in the right direction as we plan to commence shipments from our plant later this year."

About Hoku Scientific, Inc.

Hoku Scientific (NASDAQ: HOKU) is a diversified clean energy technologies company with three business units: Hoku Materials, Hoku Solar and Hoku Fuel Cells. Hoku Materials plans to manufacture, market and sell polysilicon for the solar market from its plant currently under construction in Pocatello, Idaho. Hoku Solar markets and installs turnkey photovoltaic systems and related services in Hawaii. Hoku Fuel Cells has developed proprietary fuel cell membranes and membrane electrode assemblies for stationary and automotive proton exchange membrane fuel cells.

Source: Hoku Scientific