Ciech S.A.

Legal Proceedings Report • Mar 20, 2019

Text of the report:

The Management Board of CIECH S.A. with itsregistered office in Warsaw (the "Issuer" or "Company") informs that on20 March 2019, a subsidiary of the Issuer - CIECH Soda Romania S.A. (the"Subsidiary") made a decision to initiate the procedure of collectiveredundancies in the Subsidiary.

The reason for the planned collective redundancies isthe need to restructure fixed costs by reducing the level and the costsof employment in the Subsidiary. This decision is a result of theincrease in prices of process steam as of 1 January 2019, and the riskarising from the limitation of steam supply by about 20%, as compared tothe current status, in the period from 15 May 2019 until the beginningof the next heating season, as announced by the sole supplier of processsteam - S.C. CET Govora S.A. ("CET"). The limitation of steam supply mayresult in the reduction of soda production at a comparable level.

As part of collective redundancies, the Subsidiaryintends to dismiss up to 95 employees, which represents 16,1% of theplant team, starting from 15 May 2019.

The Subsidiary will notify today the company's tradeunion organisation operating in the Subsidiary and the relevant Romanianauthorities - the Employment Office and the State Labour InspectionService about the intention and causes of collective redundancies.

At the same time, in reference to Current Report No.37/2018 of 28 December 2018, the Issuer informs that negotiations areunderway to determine the price formula for the supply by CET to theSubsidiary of the process steam in 2019-2026.