American thin-film solar module manufacturer Stion is closing up shop, even as the U.S. government prepares to implement trade remedies designed to shore up the domestic solar panel manufacturing sector.

The San Jose-headquartered company confirmed to GTM on Monday that it plans to “discontinue operations,” in a letter signed by Stion management.

The statement blames “intense, non-market competition from foreign solar panel manufacturers, especially those based in China and proxy countries” for severely undermining the viability of Stion’s business.

“The company plans to execute an assignment for the benefit of the creditors soon to sell its assets,” according to the letter. “The Hattiesburg, MS plant will initially be maintained as a turnkey solar manufacturing facility in hopes that a new owner can step in and operate the facility.”

Stion was founded in 2006 based on the work of Howard Lee, who served as the company’s first chief technology officer. In 2011, Stion announced the grand opening of its new factory in Hattiesburg, Mississippi -- the first thin-film solar factory in the Southeastern U.S. -- with the hope of creating more than 1,000 jobs and drawing $500 million of investment over the first six years.

An initial investment of $100 million was intended to build out a 100-megawatt production line and create 200 direct jobs by 2012. Stion was drawn to Mississippi in part by an incentive agreement with the state that included a $75 million loan and other tax and training incentives.

According to Crunchbase, Stion has raised at least $226 million over five rounds. The most recent round closed in 2012 totaling $25 million. The company hoped to raise $55 million and was forced to let go of staff and cut costs as a result of missing its target. At the time, spokesperson Frank Yang said the latest investment brought Stion’s total equity funding to around $240 million.

Khosla Ventures invested heavily in the company under the guidance of founding investor Samir Kaul. Stion also raised funds from Taiwan Semiconductor Manufacturing, Lightspeed Venture Partners, AVACO, Korean private equity funds, Braemar Energy Ventures, and General Catalyst Partners.

In November 2013, Khosla Ventures took a controlling share in the high-efficiency thin-film solar module maker. During that transaction -- as with this week’s announcement -- Stion executed an “assignment for the benefit of creditors.” The process is similar to a bankruptcy proceeding, but is generally deemed to be a more graceful exit strategy. In this case, the insolvent entity (assignor) transfers all of its legal and equitable interests, as well as custody and control of its property, to a third party responsible for liquidating the assets and distributing the proceeds to the assignor’s creditors.

When Khosla Ventures took control of Stion’s assets in 2013, all of the company’s employees and management team in both California and Mississippi were kept on board. The difference with this week’s announcement is that it’s expected to result in a significant number of layoffs.

Sources said company executives held a conference call with employees on Friday notifying them everyone’s last day would be on October 27. Insiders estimated there are roughly 200 U.S. employees currently at the company, but that number could not be confirmed. Yang did not deny this week that there would be layoffs, but he said the notion that Stion will be laying off the “vast majority” of workers on October 27 is factually inaccurate. However, he could not disclose exact details on the number of jobs affected or timeframe due to the sensitive nature of the situation.

As the letter from management states, Stion is hoping to find another buyer, which is probably why the company isn’t disclosing jobs numbers -- perhaps some positions can still be saved. Arguably, this isn’t the worst time for an American solar module manufacturer to go on the market.

The U.S. International Trade Commission is in the process of recommending tariffs on foreign-made crystalline silicon (CSPV) solar cells and modules, under the Section 201 trade case brought by Suniva and SolarWorld Americas. The two financially troubled solar manufacturers are seeking a tariff of 25 cents per watt on imported CSPV cells and 32 cents per watt on imported CSPV modules. Suniva also requested a floor price on all imported solar products of 74 cents per watt, while SolarWorld proposed an import quota starting at 0.22 gigawatts for cells and 5.7 gigawatts for modules.

Commissioners can adopt these recommended tariff rates, adopt another proposal, or come up with a new solution. That recommendation, due November 13, will go to President Trump, who has 60 days to make the ultimate determination. The impact on the U.S. solar market -- which relies heavily on imported CSPV products -- will depend on the final tariff levels (which GTM Research just evaluated in a new analysis).

Like other thin-film solar manufacturers, Stion is exempt from CSPV tariffs. The company also has the advantage of a U.S.-based factory, which is likely to see high demand from domestic solar project developers.

In fact, Stion production is currently sold out -- evidence of a demand spike even with trade remedies still looming. But while this is generally a favorable development for the company, executives underscored that continued pricing declines have made it virtually impossible to compete at current scale.

While cheap imported solar products likely played some role in determining Stion’s fate, the company also chose to manufacture a novel and complex solar technology in a part of the U.S. that’s new to producing copper indium gallium selenide thin-film solar panels. A restructuring announcement on the brink of being given at least a modest trade advantage prompts questions about just how big of a role these non-trade-related issues played in Stion’s recent struggles.

Stion currently has 75 megawatts of capacity operational in Mississippi, with another 75 megawatts “installed and ready to ramp if operations were to resume under a new owner,” said Yang. The building Stion is leasing could accommodate significant future expansion beyond that as well. Earlier statements show the Hattiesburg factory can accommodate more than 500 megawatts of capacity.

To date, Stion says it has shipped more than $60 million of product to more than 125 customers globally, including in North America, Europe (primarily the Netherlands and Belgium), Asia (primarily Southeast Asia and Turkey) and Africa.

“We want to express our gratitude to all our employees and backers who believed in Stion’s mission to manufacture high-performance solar technology in America,” the letter from Stion management concludes. “This is a difficult process for the company and its key stakeholders, and we are deeply disappointed by this outcome.”