POCATELLO, ID and WUXI, CHINA -- (Marketwire) -- 07/10/09 -- Hoku Materials, Inc., or Hoku, a wholly owned subsidiary of Hoku Scientific, Inc., or the Company (NASDAQ: HOKU), established to manufacture and sell polysilicon for the solar market, and Suntech Power Holdings Co., Ltd., or Suntech (NYSE: STP), the world's largest manufacturer of crystalline silicon photovoltaic (PV) modules, today announced that they have amended their polysilicon supply contract to delay the deadlines for Hoku to achieve three polysilicon plant operation milestones. The effectiveness of the amendment is contingent on Hoku entering into a definitive agreement that would result in a change of control of Hoku, and the closing of any such transaction by March 31, 2010. The Company confirmed that it has retained Deutsche Bank Securities Inc. as its financial advisor to seek a possible sale of Hoku.

Before the amendment becomes effective, Suntech has the right to terminate the contract if Hoku is unable to successfully complete a polysilicon reactor test demonstration, ship the first monthly quantity of polysilicon, or achieve a trichlorosilane (TCS) plant operation milestone, by September 30, 2009, December 31, 2009, and December 31, 2009, respectively. As amended, Hoku's deadlines to achieve these milestones may be moved to December 31, 2009, March 31, 2010, and December 31, 2010, respectively.

In exchange for Suntech extending these deadlines, Hoku has agreed in the amendment to reduce Suntech's aggregate prepayment obligation. The prepayment reduction is effected through the elimination of the TCS plant operation milestone payment. In addition, Hoku has authorized Suntech, prior to the effectiveness of the amendment, to immediately replace its cash-collateralized, stand-by letter of credit that was issued by ABN AMRO NV, with a stand-by letter of credit issued by a bank in China, which may be collateralized with non-cash assets. Suntech expects that this will have the immediate impact of freeing Suntech's restricted cash.

Suntech has already paid Hoku $2 million in prepayments in 2007, and made an equity investment of $20 million as an investor in Hoku's private offering of its common stock in February 2008.

"Although our construction progress has remained on-track to achieve the reactor demonstration and shipping milestones by September 30, 2009, and December 31, 2009, respectively, our need to raise additional capital has increased the risk that we might miss these deadlines," said Dustin Shindo, chairman and chief executive officer of Hoku Scientific, Inc. "As we previously announced our intention to delay the construction of our TCS plant to preserve capital, our ability to achieve a TCS production milestone by December 31, 2009, is now highly unlikely.