REC Silicon — AGM Information 2018

Apr 26, 2018

ANNUAL GENERAL MEETING April 26, 2018

Agenda

• 1. Opening of the meeting by the Chairman of the Board
• 1. Election of Chairman of the meeting and not less than one person to co-sign the minutes with the Chairman
• 1. Approval of the notice of the meeting and the agenda
• 1. Directors' remuneration and remuneration for the members of the Nomination Committee
• 1. Approval of auditor's remuneration
• 1. Approval of Annual Financial Statements and Directors' Report for 2017
• 1. The Board's statement regarding determination of salary and other compensation to leading employees
• 1. Authorization to issue shares
• 1. Authorization to acquire treasury shares
• 1. Election of members to the Board of Directors
• 1. Election of members to the Nomination Committee

Item 1 - Opening of the meeting by the Chairman of the Board and registration of attending shareholders

The Board's proposal for resolution:

«Thomas Aanmoen is elected to chair the meeting. James May is elected to co-sign the minutes.»

The Board's proposal for resolution:

«The notice of and agenda for the meeting are approved.»

The proposal for resolution by the Nomination Committee is:

«The recommendation from the Nomination Committee was approved. The remuneration for the period from 26 April 2018 to the annual general meeting of 2019 for the Chairman of the Board, Deputy Chair, Board members, members of Board committees and members of the Nomination Committee shall be:

Chairman of the Board	NOK 525,000
Deputy Chair	NOK 350,000
Other Board members	NOK 315,000
Members of Board committees	NOK 50,000

The remuneration to the Nomination Committee for the period from the Annual General Meeting in 2018 to the Annual General Meeting in 2019 shall be:

Chairman of the Committee NOK 30,000 Members of the Committee NOK 25,000»

The Board's proposal for resolution:

«The general meeting approves the auditor's remuneration for audit of the Annual Financial Statements of REC Silicon ASA for the financial year of 2017 in accordance with invoice.»

ANNUAL GENERAL MEETING April 26, 2018

Tore Torvund, CEO and James May II, CFO

Disclaimer

This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this presentation are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for REC Silicon ASA's (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for REC Silicon ASA's businesses, energy prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the presentation. Although REC Silicon ASA believes that its expectations and the presentation are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the presentation. REC Silicon ASA makes no representations or warranties, expressed or implied, as to the accuracy, reliability or completeness of the presentation, and neither REC Silicon ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.

This presentation was prepared for the Annual General Meeting 2018 presented on April 26, 2018. Information contained herein will not be updated. The following slides should be read and considered in connection with the information given orally during the presentation.

REC Silicon ASA shares have not been registered under the U.S. Securities Act of 1933, as amended (the "Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Act.

2017 was Earth's Third-Warmest Year on Record

Global surface temperature in 2017 compared to the 1981-2010 average. Places that were cooler than average are blue, places that were warmer than average are red.

Solar: Fastest Growing Renewable Energy Globally

Source: REC Market Intelligence

China Leads the World for Both Installations and Total Installed Capacity in 2017

Snapshot of Global Photovoltaic Markets - IEA PVPS: 2018

Electricity Production From Solar PV

REC Utilizes FBR to Produce High-quality, Low-cost Granular Polysilicon

• › World leading operator of FBR technology
• › Moses Lake FBR-A capacity:
• 18,000 MT annually
• › FBR production:
• Lowers cost of making solar products
• Reduces energy consumption by 90%
• › REC Silicon also produces:
• Semiconductor polysilicon
• Silicon gases

REC Silicon in the PV Value Chain

› REC's manufacturing process utilizes readily available metallurgical grade silicon, which is transformed into silane and polycrystalline silicon (polysilicon)

REC Silicon: 30 Years in Polysilicon and Silicon Gas Industry

Two polysilicon production facilities in the U.S.

• › FBR Technology
• The only company which has commercial volumes of FBR production
• › Largest silicon gas producer globally

COMPETITIVE ADVANTAGE

Fluid Bed Reactor (FBR) is the Most Efficient Way to Produce Polysilicon

• - Requires post processing + Ready for use
• - Low energy efficiency + High energy efficiency
• - Batch process + Continuous production

REC Silicon Remains a Low Cost Leader

FOURTH QUARTER

Strong Silicon Gas Market Share & Cost Position

Silicon Gas Sales Continue to Grow

Electronic Grade Polysilicon Sales Expand

Note: Excludes Fines & Powder

U.S./ CHINA TRADE DISPUTE

REC Silicon Blocked Out of ~80% of Market Due to US / China Trade Dispute

REC Has Limited Access to Global Market

Source: REC Market Intelligence

US Exports Into China Decreased from 40% to 5% Due to Trade War

Section 201 US / China Solar Trade Dispute Continues

› Section 201

• Affects all Imported Cells & Modules into US from all Countries
• 4 Year Remedy Announced Effective in Early February 2018
• 30% Tariff on Cells & Modules, Stepdown to 5% Over 4 Years
• 2.5 GW Cell Quota
• Much Less Severe Than Requested by Solarworld & Suniva

› President Trump Express Commitment to Pursue Settlement for US Polysilicon

• New USG is Focused on Value of US Polysilicon Industry
• Section 201 Announcement Noted "The U.S. Trade Representative Will Engage in Discussions…that could lead to positive resolution of the separate antidumping and countervailing duty measures currently imposed on Chinese solar products and U.S. polysilicon..."

› Numerous Companies Have Applied For Products to be Excluded From Section 201

• Exemption Decisions in Coming Months

› Sunpower Acquisition of SolarWorld Americas

• Sunpower Opposed Section 201 Tariffs
• SolarWorld Now Supports Sunpower Product Exclusion Request From the Section 201

US / China Solar Trade Dispute Continues

› AD/CVDs

• Section 201 Tariffs Cumulative to Existing AD/CVDs on Chinese & Taiwanese Cells and Modules
• US AD/CVDs on Chinese Solar Products Now Increased for 2016 Imports to 62%
• › Section 301 Intellectual Property Investigation
• US Threatened Tariff List does not Include Solar Cell or Panels From China
• › Geopolitical Situation between US & China is Interesting
• Potentially Preparing For a Negotiation on Trade Matters and Disputes Between the Two Countries?

	USTR		NEWS
			UNITED STATES TRADE REPRESENTATIVE
FOR IMMEDIATE RELEASE January 22, 2018			202-395-3230
Contact: USTR Public & Media Affairs media@ustr.eop.gov
			President Trump Approves Relief for U.S. Washing Machine and Solar Cell Manufacturers
Warhington, D.C. – U.S., Trade Representative Robert Lighthizer samounced today that President Trump has approved. - A president Trump has approved. re some to the state of the state and the control to the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of
USTR made the recommendations to the President based on consultations with the intersency Trade Policy Committee Vol. statement ter enventuations to the execution verse on constructions who use antiagemy states Formy Community (TPC) in response to finding by the independent, biparrisan U.S. International Trade Commission (TTC) that i
i a complete the substitution of the components, organisation of the substantial state commissions is to your System imports of Walbers and solar cells and modules are a substantial cause of serious injury to domestic
manufacturers.
These cases were filed by American businesses and thoroughly litigated at the International Trade Commission over a "
a series they then you of consumed teachers are non-regary suggests in the distancement state Commission to in Priod of several months," and Ambassador Lighthizer. "The ITC found that U.S. Broducers had been series injured
penovo ta serventa dinamas, anno Antonesseever angerissas. 19 imports and made servesi recommendations to the President. Upon receiving these recommendations, my staff and 19 imports and made servesi recommendations to the
conducted an enhancitive process which included opportunities to brief in person and through public comments, public
bearings, and meetings were reached representatives. Based on this information, the Trade Policy Committee developed tertangs, und assessings a real sensito departmentations, denotes on this interference, the admits of order in Recommendations, which the President has accepted. The President's action makes clear again that the Tump
Administration will always defend American workers, farmers, ranchers, and businesses in this regard."
exterminations of the State Projection State Control of the Control of Control of the State Control of the State Order of the State Order of the State Order of the State Order of the State Order of the State Order of the S	Year 1
First 1.2 million units of imported finished washers	20%	Year 2
		18%	Year 3 16%
All subsequent imports of finished washers	50%
Tariff on covered parts		45%	40%
Covered parts excluded from tariff	50%	45%
Injury to U.S. washing machine manufacturers stems from a sharp increase in imports that began in 2012. The ITC found angary oo voo. Haakang saabanee kadamaasharta shama saxaa maray muutaas na magonta una vegda ka avras. sino sa Gari imports of large residential wahkers increased "Headily" from 2012 to 2016, and that domestic producest" f
For imports of solar cells and modules, the President approved applying safeguard tariffs for the next four years with the Cells	Year 2
Safeguard Tariff on Modules and 30%	25%	Year 3
		20%	Year 4 15%

FINANCIAL CONSEQUENCES

Polysilicon Spot Price

• › Market Prices Declined Due to Seasonality Slow Down
• › REC Prime Grade Solar Price Increase 4.8% vs. Q4'17
• Contracted Early in the Quarter
• › REC Expects Prices for Q2 in Line with Q1

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR 2017 2018

Copyright © 2017 PVinsights.com All rights reserved

FBR Cash Cost Under Control, Even at Reduced Rates

Strong Efforts to Reduce Cost in Both Moses Lake and Butte

2012-2017 Headcount Totals

Drastic Reduction in Costs Has Resulted in Positive EBITDA

Revenues EBITDA

-40	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1
	2013	2014				2015				2016				2017			2018

YULIN JV UPDATE

Yulin JV Financial History

› 2014 Yulin JV Agreement:

• Received \$198M for Technology Transfer
• Paid off \$142.7M of REC Debt
• REC's Equity Contribution
• 15% August 2014: \$75M
• 34% July 2017: \$169M Resolved

› February 1, 2018 Agreement:

• Yulin JV Shareholding:
• SNF ~85%, REC Silicon ~15%
• REC to Pay:
• \$ 0.6M in Interest (Paid Q1'18)
• \$10.4M in 3 Installments (Paid \$2.1M Q1'18)
• After January 2021, REC has the option to:
• Buy back ~34% Equity Interest from SNF,
• or Remain a ~15% Equity Holder,
• or Sell REC's ~15% Equity Interest

Yulin JV Signing Ceremony February 2014

REC JV Team Recognized in China

Production Goals for 2018: 8,000 MT Granular Polysilicon

Fluid Bed Reactor Status:

• › ~800 MT Granular Polysilicon Produced in Q1'18
• Secondary Quality Start-up Material
• › Remaining FBR Reactors Start-up end of Q2'18

Silane Unit Status:

• › Silane 20 Unit Running at Half Capacity
• › Silane 10 Unit Start-up end of Q2'18

Siemens Reactor Status:

• › Siemens Reactors Finishing Pre-production Preparations
• › Starting Commercial CZ production in Q2'18
• › FZ Production Trial Runs Starting in H2'18

Total Investment Within Budget of \$1.25 Billion

STATUS

January 20, 2018

	Navn	Eierandel
	Umpe (Jens Ulltyeit-Moe)	21.16%
	UBS (riom.)	4.50%
	Folketrygdfondet	4.14%
	The Bank of New York Mellon (nom.)	3.45%
	DNB Teknologi	3.16%
	SEB	1.74%
	DNB Norge (IV)	154%
8	Caceis Bank (nom.)	1.47%
$\mathbf Q$	Kagra Gruppen (Jens Ulltveit-Moe)	1.40%
10	SEB (nom.)	137%

(Mill. USD)				3.kv. 17 3.kv. 16 1 - 3.kv. 17 1 - 3.kv. 16 2016
Driftsinntekter	75.5			50.9 194.3 190.8 271.2
EBITDA		$3.6 - 7.9$		$9.5 -35.7 -30.8$
Res. for skatt -119.8		$-141.2$	$-2019$	$-260.6 - 248.1$
Res. etter skatt -122		$-985$	$-213.9$	$-181.9 - 147.4$
Kontantbeholdning 88 86.8			88	86.8 65.8

√ REC 03 √ Convertible Bond √ Yulin JV

Tax

Trade War

Refinancing Will Create Financial Runway for REC Silicon

Pre-transaction capital structure and debt maturities Post-transaction capital structure and debt maturities

The refinancing will create a financial runway for the Company

Share Price Up ~+25% Since Last AGM

REC Silicon – The Investment Case

• › Strong long-term growth in PV, semiconductor polysilicon and silicon gas demand
• › FBR technology is the most energy efficient way to make polysilicon
• › REC Silicon is the only company with proven commercial FBR operation
• › REC Silicon has a dominant position in the Silicon Gas Market

› Presence in China through Yulin Joint Venture

FINANCIAL REVIEW

(USD million)		2017		2016
	Revenues	EBITDA	EBIT	Revenues	EBITDA	EBIT
US Operations	275.2	23.3	(123.6)	271.2	(29.0)	(121.2)
Special Items	-	-	-	-	-	-
Impairment	-	-	(0.3)	-	-	(93.1)
Parent Company & Other	-	(2.3)	(2.3)	-	(1.7)	(1.7)
Eliminations	(2.9)	(1.2)	(1.2)	-	-	-
REC Silicon	272.4	19.8	(127.5)	271.2	(30.8)	(216.0)

Revenues - \$272.4M

• › 0.4% Increase vs. 2016
• › Polysilicon Revenues vs. 2016
• 2.7% Increase in Revenues
• ( 0.2%) Decrease in Average Solar Grade Prices
• 15.9% Increase in Total Sales Volumes
• › Silicon Gas Revenues vs. 2016
• ( 0.2%) Decrease in Revenues
• (18.6%) Decrease in Silane Prices
• 28.1% Increase in Total Sales Volumes

EBITDA of \$19.8M

• › Reflects:
• Higher Silicon Gas Sales Volumes
• Higher Polysilicon Sales Volumes
• Lower FBR Cash Cost \$10.6/kg in 2017 vs. \$15.3/kg in 2016

Cash Flows

Cash Flows From Operating Activities \$38.8M

• › (\$19.8M( EBITDA
• › (\$31.4M( Working Capital Decrease
• \$22.6M Decrease in Inventories
• \$ 5.1M Decrease in Accounts Receivable
• \$ 3.6M Increase in Accounts Payable
• › (\$12.4M) Interest payments
• › (\$ 0.6M( Tax Refund
• › (\$ 0.2M) Other

Cash Outflows From Investing Activities (\$2.8M)

• › (\$ 2.6M) CapEx
• › (\$ 0.2M) Increase in Restricted Cash Balances

Currency Gain of \$2.8M

› Weaker USD vs. NOK

Nominal Debt - \$190M

• › Increased by \$4M in 2017
• Due to Weaker USD Relative to NOK

Nominal Net Debt - \$85M

• › Decreased by \$35M in 2017
• Increase in Cash of \$39M
• Increase in Nominal Debt of \$4M

Indemnity Loan - \$24M

• › Callable Beginning in February 2016
• › Has not Been Called
• › Due Date is Uncertain

Reassessment of Tax - \$30M

• › Response to Norwegian Central Tax Office Filed
• › Do Not Expect Final Ruling Before H2'18
• › Uncertain Timing and Outcome

Completion of \$110M Bond Issue

Successful Issuance of \$110M Senior Secured Bond on March 23, 2018

• › 11.5% Coupon with Semi-annual Interest Payments
• › Settlement Completed on April 13, 2018
• › Five Year Term Due on April 13, 2023

Debt Repurchase of \$112M

• › REC03 NOK 9 million at 100.5% Plus Accrued Interest (\$1.3M)
• › USD Convertible \$41.6M at 103.5% Plus Accrued Interest (\$43.3M)
• › USD Convertible \$66.2M at 102.0% Plus Accrued Interest (\$67.9M)

Remaining Debt Maturities

• › \$57M REC03 Due on May 3, 2018
• › \$2.3M USD Convertible Due on Sep 11, 2018

Questions?

The Board's proposal for resolution:

«The General Meeting approves the Annual Financial Statements and the Directors' Report for 2017. No dividends will be paid for the financial year" .

Synthetic option program

• Cash bonus corresponding to the positive share price development
• Easier to manage for US employees

6 year program

• 3 year lock-up, then disbursement over the following 3 years (provided the share price has increased above price at grant)
• Price at grant = 110 % of average price the last 5 days ahead of grant
• Cap on yearly disbursements equal to base salary for the calendar year
• Conditional on continued employment
• Incentives for leading employees in critical areas
• Total cost of the program
• Equals 0.47% of the share capital (12,000,000/2,543,818,785)
• Total cost if the share price increases 100 % = approx MNOK 14.2

The Board's proposal for resolutions:

• «1: "The General Meeting supports the statement of the Board regarding compensation to leading employees.
• 1. The General Meeting adopts the statement of the Board regarding long term incentive plans and measures for keeping key personnel.»

Item 8 – Authorization to issue shares – general financing purposes

The Board's proposal for resolution:

«The Board is granted authorization to increase the share capital with up to NOK 254,000,000, which equals approx. 10 % of the existing share capital, by issuing up to 254,000,000 shares through one or several share capital increases. The authorization to acquire shares shall be used for one or more of the following purposes: (i) in connection with investments, mergers and acquisitions; (ii) in connection with effectuation of mandatory share issues and to carry out the consolidation of shares and/or; (iii) to provide the Company with financial flexibility. Price and conditions for subscription will be determined by the Board on issuance, according to the Company's needs and the shares' market value at the time. Shares can be issued in exchange for cash settlement or contribution in kind. The existing shareholders preemptive rights to subscribe shares can be deviated from in connection with the effectuation of this authorization. The Board's authorization is valid until the Annual General Meeting in 2019, but shall in any event expire at the latest 15 months from the date of this General Meeting. The Board is at the same time given authorization to make the necessary amendments to the articles of association on execution of the authorization. This authorization replaces all previous authorizations to increase the share capital.»

The Board's proposal for resolution:

«"The Board is granted authorization to acquire shares in REC Silicon ASA on behalf of the Company for one or more of the following purposes: (i) in connection with the Company's share option program for its employees, and/or (ii) to increase return on investment for the Company's shareholders. The authorization covers purchase(s) of up to 10% of the face value of the share capital of the Company, cf. the public limited liability companies act §§ 9-2 and 9-3. Shares may be acquired at minimum NOK 0.10 per share and maximum NOK 10 per share. The shares shall be acquired through ordinary purchase on the stock exchange. The Board's authorization is valid until the Annual General Meeting in 2019 or until it is revoked by a General Meeting resolution passed with simple majority, but shall in any event expire at the latest 15 months from the date of this General Meeting.»

Proposed resolution:

«The following are elected as members of the Board of directors for a period of one (1) year until the next Annual General Meeting:

• Jens Ulltveit-Moe
• Espen Klitzing
• Ragnhild Wiborg
• Inger Berg Ørstavik
• Terje Osmundsen»

Proposed resolution:

«Rune Selmar is re-elected as a member of the Nomination Committee for a period of two (2) years. Ole Jacob Ræstad and Live Haukvik Aker have one (1) year left of their respective service periods as members of the Nomination Committee. Rune Selmar is elected as the Chairman of the Nomination Committee.»

Thank you.

63 © REC Silicon ASA. All rights reserved. Confidential

Learn more: recsilicon.com