Enea S.A. — M&A Activity 2018

Dec 31, 2018

Current Report No.: 68/2018

Date of Preparation: 29 December 2018

Short Name of Issuer: ENEA S.A.

Subject: Conclusion of a memorandum of understanding concerning theimplementation of the Ostrołęka C project

Legal basis: Article 17(1) MAR - confidential information

Content of report:

The Management Board of ENEA S.A. ("Issuer"), hereby informs that on 28December 2018 the Issuer concluded a memorandum of understanding("Memorandum of Understanding") with ENERGA S.A. and ElektrowniaOstrołęka Sp. z o.o. ("Company"), concerning the implementation of theOstrołęka C project ("Project"). Pursuant to the Memorandum ofUnderstanding, the Investment Agreement together with the Annex, ofwhich the Issuer informed in Current Report No. 42/2016 of 8 December2016 and Current Report No. 13/2018 of 26 March 2018 respectively, shallbe terminated.

The Memorandum of Understanding stipulates new terms of cooperation,including the Project's financing structure, whereby the Issuer declaresits financial involvement in the execution of the Construction Stage inthe amount of PLN 1 billion and ENERGA S.A. in the amount of not lessthan PLN 1 billion, in addition to the funds already committed.Moreover, the Memorandum of Understanding provides for the involvementof further investors to contribute the remainder necessary to cover thefinancial outlays for the Project. By 28 January 2019, the parties tothe Memorandum of Understanding intend, inter alia, to:

-agree on the form, time schedule and terms of financial involvement ofa financial investor and/or other investors;

-conclude a new investment agreement;

-agree on the terms for granting loans necessary for the execution ofthe Construction Stage to the Company by lenders in a manner notviolating the obligations assumed by the Issuer and ENERGA S.A. underexternal financing (the so-called financial covenants).

The conclusion of the Memorandum of Understanding constituted acondition for the Issuer's granting consent to a notice to proceed (NTP)being issued to the general contractor by the Company.