REC Silicon

Regulatory Filings • Sep 6, 2023

REC Silicon Signed full form FBR offtake agreement

REC Silicon Signed full form FBR offtake agreement

REC Silicon ASA ("REC Silicon" or the "Company") announces the entering into a

full-form supply agreement between its subsidiary REC Solar Grade Silicon LLC

and 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

FBR granular polysilicon produced from REC Silicon's facility at Moses Lake,

Washington (the "Supply Agreement").

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.

- The prepayments are important to REC Silicon's overall financing plan, and

the full-form supply agreement was an imperative milestone for the reopening

of the Moses Lake facility. As previously stated, it was important to have a

high-quality offtake partner and we have that in Hanwha Q Cells. We are

pleased with the terms and now look forward to a successful restart of the

plant. The process remains on schedule and budget for a re-start by November

1, 2023, with an ambition to reach full capacity utilization by year end 2024,

says Kurt Levens CEO of REC Silicon.

The Supply Agreement provides for the sale to Hanwha of 100% of the prime

high-purity granular production from the facility and replaces the binding

term sheet between the parties that was announced on January 31, 2023.

Prepayments will be credited against purchases of polysilicon pursuant to a

linear reimbursement schedule over the 10-year term. The estimated total

value of the Supply Agreement for the duration of the arrangement will

fluctuate depending on market prices, which are currently estimated to be

approximately $3 billion.

The base price for the FBR granular polysilicon in the Supply Agreement will

be determined by market indices (representative of markets outside and inside

of China) 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.

As a leading producer of Silicon Gases and High Purity Polysilicon, REC

Silicon is well positioned to capitalize on the global megatrends of

digitalization, energy transition and energy storage and provide crucial

material inputs to the IRA, Chips and Infrastructure Acts. The company has

developed a strong market position in the Semiconductor industry based on its

operations in Butte. The re-opening of the Moses Lake operations will enable

REC Silicon to provide High Purity Polysilicon to an emerging US solar value

chain and together with the Butte operation potentially supply Silane gas for

anode material to a fast-growing battery industry.

Please find attached an announcement as required pursuant to 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 announcement will

also be available on the Company's website.

Contacts

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Jack Yun

CFO

Email: jack.yun@recsilicon.com

Nils O. Kjerstad

IR Contact

Phone: +47 9135 6659

Email: nils.kjerstad@recsilicon.com

About Us

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REC Silicon is a leading producer of advanced silicon materials, delivering

high-purity polysilicon and silicon gas to the solar and electronics

industries worldwide. We combine over 30 years of experience and proprietary

technology with the needs of our customers, with annual production capacity of

more than 20,000 MT of polysilicon from our two US-based manufacturing plants.

Listed on the Oslo Stock Exchange (ticker: RECSI), the Company is

headquartered in Lysaker, Norway.

For more information, go to: www.recsilicon.com

This information has been submitted pursuant to the Securities Trading Act §

5-12 and MAR Article 19 no. 3. The information was submitted for publication

at 2023-09-06 08:20 CEST.