Hoku Scientific Secures $13 M Bank of Hawaii Credit for Polysilicon

Kapolei, Hawaii [RenewableEnergyAccess.com] Hoku Materials, Inc., a subsidiary of Hoku Scientific, Inc. established to manufacture and sell polysilicon for the solar market, announced that Bank of Hawaii is providing Hoku Materials with a credit facility of up to $13 million.

Hoku Materials plans to use these funds to finance, in part, certain expenses related to its polysilicon production facility in Idaho. The arrangement includes the initial deposit of 3.1 million Euros (approximately $4.2 million) under its polysilicon reactor purchase contract with GEC Graeber Engineering Consultants GmbH, and MSA Apparatus Construction for Chemical Equipment Ltd. Payment of this initial deposit will begin the 15-month delivery deadline for equipment capable of producing 1,500 metric tons of polysilicon per year, with additional equipment being delivered within three months after the first delivery. This additional equipment will allow Hoku Materials to manufacture an additional 500 metric tons of polysilicon per year, for a planned annual production capacity of 2,000 metric tons. The credit facility will be secured by Hoku Materials’ cash, cash equivalents and short-term investment fund balances. “This credit facility from Bank of Hawaii enables us to order our polysilicon reactors in time to meet our planned polysilicon production and customer delivery schedule in early 2009,” said Dustin Shindo, Chairman and CEO of Hoku Scientific. “In addition to this $13 million credit facility, we plan to finance the estimated $260 million to construct our polysilicon production facility with customer prepayments and debt. SANYO has already deposited approximately $110 million into an escrow account as a prepayment against our $370 million seven-year polysilicon supply agreement with them,” added Shindo.