REC, Evergreen and Q-Cells, equal partners in Sovello AG, have entered into an agreement to sell 100 percent of the shares in Sovello to Ventizz Capital Fund IV, L.P.

As referred to in the Q4 2009 report, the shareholders of Sovello AG on February 5, 2010, signed a non-binding term sheet for the sale of 100 percent shares in Sovello.

As earlier communicated, REC recognized impairment charges and provisions related to Sovello per December 31, 2009. These are estimated to be sufficient to cover REC's exposure to Sovello, and no further losses are expected from closing of the transaction. REC has proportionately consolidated 33.3 percent of Sovello AG on a line-by-line basis in REC's consolidated financial statements.

The transaction is subject to certain closing conditions, and closing of the transaction is expected to take place during April 2010.

It is expected that REC's polysilicon supply agreement will be revised as part of the transaction. Any surplus polysilicon volumes will be reallocated.