EMCORE secures $25M equity financing commitment

OCTOBER 2, 2009 -- EMCORE Corp. has entered into a committed equity financing facility under which it has the option to sell up to $25 million of its registered common shares to Commerce Court Small Cap Value Fund Ltd. over a 24-month period.

OCTOBER 2, 2009 -- EMCORE Corp., a provider of compound semiconductor-based components, subsystems, and systems for the fiber-optic and solar power markets, has entered into a committed equity financing facility under which it has the option to sell up to $25 million of its registered common shares to Commerce Court Small Cap Value Fund Ltd. over a 24-month period. Under the terms of the financing agreement, EMCORE is not obligated to utilize any of the facility and remains free to enter into other financing transactions.

EMCORE will determine, at its sole discretion, the timing and dollar amount of each draw under this facility, subject to certain conditions. When and if EMCORE elects to use the facility, the number and price of shares sold in each draw will be determined by a formula, pursuant to which EMCORE will issue shares to Commerce Court at a prenegotiated discount to the volume weighted average price of EMCORE's common stock over a preceding period of trading days. The Commerce Court Small Cap Value Fund seeks diversified investment opportunities in innovative small and mid capitalization companies that offer compelling growth or value propositions. Acqua Capital Management Company serves as an advisor to Commerce Court.

In connection with the execution of the equity financing facility, EMCORE has issued to Commerce Court 185,185 shares of common stock as a commitment fee and warrants to purchase 1.6 million shares of EMCORE common stock at prices that represent a 25% to 75% premium over the market price at the time of closing. The offer and sale of any shares by EMCORE under this equity financing facility has been registered pursuant to a shelf registration statement declared effective by the Securities and Exchange Commission on July 17, 2009.

"This extremely flexible financing facility is an important addition to our portfolio of financing options, providing the Company with the ability to raise capital quickly and at a competitive cost while potentially managing dilution more effectively by issuing shares in multiple tranches at times of our choosing," says John M. Markovich, chief financial officer of EMCORE. "This equity facility, in combination with our line of credit with Bank of America and our improved operating performance, has served to substantially improve the company's liquidity position."

Net proceeds from any sale of the securities will be used for general corporate purposes that may include new product development, capital expenditures, and increases in working capital necessary to support the growth in certain sectors of the business.


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