Current Report No.: 35/2023

Current Report No.: 35/2023

Date of Preparation: 10 August 2023

Issuer's Abbreviated Name: ENEA S.A.

Subject: Execution of documents summarizing the transaction terms for the acquisition of 100 percent shares of ENEA Wytwarzanie Sp. z o.o. and ENEA Elektrownia Połaniec S.A. by the State Treasury

Legal Basis: Article 17(1) of the Market Abuse Regulation - confidential information

Body of the report:

With reference to:

- Current Report No. 24/2021 of 23 July 2021 on the execution of a memorandum of understanding on cooperation in a spin-off of coal assets and their integration within the National Energy Security Agency ("NABE"),

- Current Report No. 30/2023 of 15 July 2023 on the receipt of the proposed transaction terms for the acquisition of shares of ENEA Wytwarzanie Sp. z o.o. and ENEA Elektrownia Połaniec S.A. by the State Treasury, and

- Current Report No. 34/2023 of 10 August 2023 on the acceptance of proposed transaction terms for the acquisition of shares of ENEA Wytwarzanie Sp. z o.o. and ENEA Elektrownia Połaniec S.A. by the State Treasury.

The Management Board of ENEA S.A. ("Issuer") hereby reports that on 10 August 2023, the Issuer and the State Treasury represented by the Minister of State Assets ("Parties") signed the documents ("Document", "Term Sheet") summarizing the transaction terms for the acquisition by the State Treasury of all the shares held by the Issuer in ENEA Wytwarzanie sp. z o.o. ("EW") and ENEA Elektrownia Połaniec S.A. ("EEP") with their subsidiaries (jointly referred to as "Subsidiaries") in order to establish NABE ("Transaction").

The Document does not constitute an offer or a commitment to enter into an agreement.

The signed Document will form the basis for the Minister of State Assets to submit a motion to the Council of Ministers for the acquisition of EW shares and EEP shares by the State Treasury.

Based on the provisions of the Document, the Parties will agree on a draft preliminary purchase agreement and a draft final purchase agreement. The transaction will be carried out only if the State Treasury successfully concludes negotiations with all of the following companies: ENEA S.A., TAURON Polska Energia S.A., PGE Polska Grupa Energetyczna S.A. and Energa S.A.

Price for EW shares and EEP shares and debt settlement mechanism

As reported in Current Report No. 30/2023 of 15 July 2023, the Term Sheet stipulates that the State Treasury will acquire EW shares at a price of PLN 2,479,000,000 and EEP shares at a price of PLN 632,000,000. The Document further stipulates that the debt of the Subsidiaries to the Issuer in the amount of PLN 2,380,000,000 will be repayable under a subordinated loan agreement over a period of 8 years from the conclusion of the Transaction, but no later than 31 December 2031, with the repayment to be guaranteed by the State Treasury up to 70% of the debt. The interest rate on the loan will be based on the WIBOR benchmark rate plus a fixed margin. If the Subsidiaries' debt to the Issuer as at the date of the State Treasury's acquisition of the EW and EEP shares is higher, the difference will be repaid by NABE from a loan granted to NABE by banks under the Transaction.

Material terms of the preliminary agreement

The Term Sheet specifies the conditions on which the Parties have conditioned the conclusion of the preliminary agreement for the sale of EW shares and EEP shares to the State Treasury, including in particular:

a) reaching agreement on the content of the documentation related to the Transaction, including the future financing of NABE and obtaining preliminary credit decisions of banks for financing NABE,

b) the Prime Minister approving the motion for the acquisition of EW shares and EEP shares by the State Treasury from the Restitution Fund,

c) obtaining all internal approvals and permits required to enter into or execute the Transaction.