PGE Polska Grupa Energetyczna S.A.

M&A Activity • Jan 23, 2025

Report Content Signing of term sheet with ZE PAK S.A. on potential acquisition ofshares in PAK CCGT Sp. z o.o. and in PGE PAK Energia Jądrowa S.A.

The Management Board of PGE Polska Grupa Energetyczna S.A. ("PGE", the"Company") discloses that on January 23, 2025 the Company signed with ZEPAK S.A. ("ZE PAK") a term sheet (the "Term Sheet") regarding potentialtransaction of acquisition by PGE from ZE PAK of:

- 100% shares in PAK CCGT sp. z o.o., and

- 50% shares in PGE PAK Energia Jądrowa S.A.

PAK CCGT sp. z o.o. is implementing investment in 600 MWe class CCGTunit together with accompanying infrastructure for which it obtained17-year capacity auction contract for delivery year 2026 at a level of493 MW with a price of PLN 400.39/kW/year. The general contractor of theinvestment is the syndicate of Siemens Energy Global GmbH Co KG, SiemensEnergy sp. z o.o. and Mytilineos S.A. (see current reports of ZE PAK no.28/2021, no. 29/2021 and no. 22/2023).

The founders and existing partners (50/50 model) of PGE PAK EnergiaJądrowa S.A. responsible for the development project of nuclear powerplant in Konin region are PGE Polska Grupa Energetyczna S.A. and ZE PAKS.A. (see current reports of PGE no. 48/2022 of October 31, 2022 and no.9/2023 of March 7, 2023). PGE PAK Energia Jądrowa S.A. possesses thefundamental decision for the construction of a nuclear power plantissued by the Minister of Climate and Environment in November 2023.

In the Term Sheet the parties agreed the basic terms of potentialtransaction of acquisition of shares in PAK CCGT sp. z o.o. and PGE PAKEnergia Jądrowa S.A. and PGE's exclusivity for negotiations with thisregard until June 30, 2025 (planned closing of the transaction) wherebythe document does not oblige parties to realization of the transaction.The detailed transaction terms will be determined after due diligenceperformed by PGE with the participation of external legal, financial andtax as well as technical and environmental advisors.