In an ongoing effort to raise funding for a proposed polisilicon production plant, Hoku Scientific, Inc. (NasdaqGM:HOKU) announced an equity distribution agreement with UBS Securities, LLC that could raise up to $54 million.
The agreement allows Hoku to sell shares of its common stock (with par value $0.001 per share) from time to time through UBS, as sales agent.
The net proceeds from the offering will be used for engineering, procurement and construction of the company’s 3,500 metric ton polysilicon production facility in Pocatello, Idaho, as well as for general corporate purposes.
Hoku and Merrill Lynch recently cancelled an agreement for up to $185 million to fund the plant.
The company intends to fund construction of the plant through a combination of customer advances, subject to the achievement of certain project milestones, available cash and additional capital.
In addition to the $54 million which the company anticipates raising through the equity distribution program with UBS, Hoku estimates it will need to raise approximately an additional $56 million to complete engineering, procurement and construction of the plant, which the company intends to raise through one or more subsequent debt or equity offerings during calendar year 2009.
Suntech Power Holdings (NYSE: STP), a customer of Hoku, purchased a $20 million share in the company in February and is one of several photovoltaic solar manufacturers who have amended polisilicon agreements with Hoku in order to help the company fund its new production facility.
About Hoku Scientific, Inc.
Hoku Scientific, Inc. 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 is a provider of turnkey photovoltaic systems in Hawaii. Hoku Fuel Cells has developed proprietary fuel cell membranes and membrane electrode assemblies for stationary and automotive proton exchange membrane fuel cells.
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