Water Street Capital Comments On Latest Update From REC Silicon Board of Directors

"Yesterday's announcement by the Board of REC Silicon, elected by the majority of shareholders at the Company's recent Annual General Meeting, confirms what Water Street has believed since the release of its shareholder letter on May 23, 2025: Hanwha Solutions Corporation's ("Hanwha") NOK 2.20 offer significantly undervalues REC Silicon's assets and intellectual property. However, due to the onerous restrictions outlined in Hanwha's one-sided Transaction Agreement ("TA") and its subsequent endorsement by the Company's previous Board, the new Board of REC Silicon is not given the opportunity to maximize shareholder value. 

The Board clearly states that 'The Transaction Agreement entered into on 24 April 2025 between the Company and Anchor, under Norwegian statutory law, further restricts the Board's ability to pursue alternative financing and strategic options in the current situation. Hanwha has not taken any steps to release the Board from these restrictions, but instead approached the Board and reserved the right to initiate legal action against each individual board member for failure to comply with its alleged duties.'

We find it difficult for a board to fulfill its duty to maximize shareholder value when threatened by the very shareholder responsible for placing the company into this perilous situation. That same shareholder agreed to fund the Company in the TA, only to retract that pledge when it lost control of the Board. Water Street believes that this act is a material breach of the TA under United States law.