REC Silicon

Related Party Transaction • Sep 6, 2023

Section 3-19 Announcement of Material Agreement Concluded between REC Silicon ASA's Subsidiary REC Solar Grade Silicon LLC and Hanwha Q Cells Georgia, Inc.

Moses Lake, Washington USA September 6, 2023. REC Solar Grade Silicon LLC, a subsidiary of Silicon ASA ("REC Silicon" or the "Company") has entered into a full form supply agreement with Hanwha Q Cells Georgia, Inc., ("Hanwha") a wholly owned subsidiary of Hanwha Solutions for a 10 year take-or pay supply agreement for high purity granular polysilicon produced from REC Silicon's facility at Moses Lake, Washington (the "Supply Agreement") utilizing its proprietary FBR process. The Supply Agreement provides for the sale to Hanwha of 100% of the prime high purity granular production from the facility. The Supply Agreement will provide the Company with a 10-year secure offtake for all the prime high purity granular production from the Moses Lake facility and will replace the binding term sheet that was previously announced, which was the subject of a previous Section 3-19 Announcement on January 31, 2023.

The base price for the polysilicon in the Supply Agreement will be determined by market indices adjusted for a premium for US-sourced low carbon material. The high purity FBR granular polysilicon will also benefit from the \$3 per kilogram tax credit from the Inflation Reduction Act. For the first five years of the agreement, the base price is subject to both a price minimum and maximum that protects REC Silicon against potential low market prices in the near term. For the second five years of the agreement, there is no minimum or maximum price, which provides the Company with upside to benefit from higher polysilicon market prices in the future.

The estimated total value of the Supply Agreement for the duration of the arrangement will fluctuate depending upon market prices, which are currently estimated to be approximately \$3 billion.

To secure the Supply Agreement obligations and to support the restart of the Moses Lake facility, Hanwha will make sizeable prepayments at the time of the signing of the Supply Agreement and at first delivery (together the "Prepayment"). The Prepayment will be credited against purchases of high purity granular polysilicon pursuant to a linear reimbursement schedule over the 10-year term.

Chinese tariffs on polysilicon manufactured in the USA, and reduced capacity of REC Silicon customers outside of China for the Company's solar grade granular polysilicon resulted in the shutdown of the Moses Lake facility in 2019. However, the introduction of a broad clean energy incentive package in the USA, which includes the Solar Energy Manufacturing for America Act (SEMA), now allows for the development of a solar value chain outside of China as previously announced by Q Cells and as referenced in the Company's January 14, 2023, press release. As a leading producer of high-purity Silicon Gases and Granular and Electronics Grade polysilicon with assets in Moses Lake and Butte, REC Silicon is well positioned to benefit from the digital revolution as well as the renewable energy, and energy storage megatrends that fuel the clean energy transition and enable the re-building of Solar and Semiconductor manufacturing in the USA.

Hanwha Solutions together with its affiliate Hanwha Corporation control 33.3% of the shares in REC Silicon ASA and is represented at the board of directors by Tae Won Jun, CSO Hanwha Corporation, as the board chair and Dong Kwan Kim, CEO Hanwha Solutions, as deputy chair. Both chair Tae Won Jun and deputy chair Dong Kwan Kim recused themselves from discussing and voting on the Supply Agreement.

The Supply Agreement was assessed by two independent third-party experts in the industry that confirmed to the REC Silicon ASA board of directors that the Supply Agreement is balanced, at arm's length, and contains consistent commercial terms to other similar polysilicon Supply Agreement transactions in the industry. The Supply Agreement presented an attractive opportunity compared to other commercial conversations after taking into account relevant considerations. The board of directors are therefore of the view that the Supply Agreement has been entered into on arm's length market terms and in the best interests of REC Silicon ASA and its shareholders as a whole.

This announcement is posted on REC Silicon's website in compliance with Section 3-19 of the Norwegian Public Limited Liability Companies Act, which regulation applies whenever a subsidiary of a public company such as REC Silicon ASA enters into a qualifying material agreement with a related party.

The Board of Directors of REC Silicon ASA

Dr. Renate Oberhoffer-Fritz Paraskevi (Vivian) Bertseka Roberta Benedetti

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