Ciech S.A.

Capital/Financing Update • Apr 7, 2020

The Management Board ofCIECH S.A. (the“Issuer”)herewith informs that on 7 April 2020, the Issuer and its subsidiaries:CIECH Sarzyna S.A., CIECH Pianki sp. z o.o., CIECH Soda Polska S.A. andCIECH Vitrosilicon S.A. (hereinafter jointly referred to as the“Recipients”) entered into a supplier financing agreement (reversefactoring) (the “Agreement”) with BNP Paribas Faktoring sp. z o.o. (the“Factor”).

Theconclusion of the Agreement fits in well with the Issuer's policy aimedat limiting risks related to the current market situation. Reversefactoring is to ensure an improvement in the Recipients’ liquidity.

Thesubject matter of the Agreement is to define terms and conditions ofcooperation with regard to financing the Recipients' suppliers,including conditions under which the Factor is to acquire amountsreceivable from suppliers that have been designated by the companiesdefined as the Recipients.

TheAgreementprovidesfor two possible options in terms of payments to be made by the Factorwith respect to the accounts receivable of the suppliers (at thediscretion of the respective supplier):1) repaymentbefore the due date indicated in the VAT invoice issued by the supplier,the cost of the Factor’s financing, until the payment date, will beborne by the supplier and the Recipient’s repayment of their liabilitiesto the Factor made after the grace period,

2) repaymenton or before the due date indicated in the VAT invoice issued by thesupplier and the Recipient’s repayment of their liabilities to theFactor after the grace period.

TheAgreement grants the Recipients a total limit of PLN 150,000,000.00 (onehundred fifty million and 00/100 zlotys). This is a revolving limit. Inthe cases specified in the Agreement and in the period of notice, theFactor has the right to refuse to acquire accounts receivable.

Thecollateral for the repayment of the Recipients’ liabilities to theFactor under the Reverse Factoring Agreement is:1)  jointand several liability of companies covered by the definition ofRecipients for their liabilities to the Factor

2) debtaccession by CIECH Energy Deutschland GmbH and CIECH Soda DeutschlandGmbH & CO KG. (hereinafter jointly referred to as the “GermanCompanies”), provided however that the joint and several liability ofthe German Companies for the Recipients’ liabilities to the Factor willbe limited to PLN 187,500,000.00 (one hundred eighty seven million fivehundred thousand and 00/100 zlotys).

TheReverse Factoring Agreement has been concluded for an indefinite period.

Anyother terms and conditions of the Reverse Factoring Agreement do notdeviate from those commonly used in business transactions for this typeof agreement. 

Incooperation with BNP Paribas Bank Polska S.A., the Issuer intends toprovide the reverse factoring coverage also to its German Companies.According to the terms of the Agreement, the total limit available tothe Recipients and the German Companies may not exceed: PLN200,000,000.00 (two hundred million and 00/100 zlotys). 

Legal basis: Article17.1 of the Regulation of the European Parliament and of the Council(EU) No. 596/2014 of 16 April 2014 on Market Abuse (the Market AbuseRegulation) and repealing Directive 2003/6/EC of the European Parliamentand of the Council and Commission Directives 2003/124/EC, 2003/125/ECand 2004/72/EC (Official Journal of the European Union L No. 173, p. 1).