Enea S.A. — M&A Activity 2021

Jun 25, 2021

Current Report No.: 21/2021

Date of Preparation: 25 June 2021

Issuer's Abbreviated Name: ENEA S.A.

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

Subject: Signing of documents regarding the settlement of the Coal-FiredProject executed as part of the Ostrołęka C Project and the execution ofthe Gas-Fired Project in Ostrołęka

Body of the report:

The Management Board of ENEA S.A. ("Issuer") hereby reports that it hasobtained information about the signing, on 25 June 2021, betweenElektrownia Ostrołęka Sp. z o.o. (the Issuer's related party,hereinafter referred to as "EO" or the "Coal-Fired Project Employer")and CCGT Ostrołęka Sp. z o.o. (hereinafter referred to as "CCGTOstrołęka" or the "Gas-Fired Project Employer") on one side, and GEPower sp. z o.o. with its registered office in Warsaw, GE Steam PowerSystems S.A.S. (formerly: ALSTOM Power Systems S.A.S.) with itsregistered office in Boulogne-Billancourt, France (collectively referredto as the "Coal-Fired Project Contractor") and General Electric GlobalServices GmbH with its registered office in Baden, Switzerland (jointlywith GE Power sp. z o.o. referred to as the "Gas-Fired ProjectContractor") on the other side, of the "Amendment document to thecontract of 21 July 2018 for the construction of the 1000 MW Ostrołęka CPower Plant" ("Contract Amendment Document"), along with the Gas Annex,simultaneously executed by the respective parties, along with theService Agreement and the Coal-Fired Project Settlement Agreement, thebasic features of which are presented below by the Issuer.

I. In accordance with the Contract Amendment Document:

1) the terms and conditions for the execution of the investment projectcovered by the contract of 12 July 2018 for the construction of the 1000MW Ostrołęka C Power Plant entered into by and between the Coal-FiredProject Employer and the Coal-Fired Project Contractor ("Contract"),following the change in the technology and the reaching of an agreementon the subject matter of the investment project as the construction of acombined cycle power plant (in place of a coal-fired power plant), thatis the Gas-Fired Project, is specified in an annex to the Contractentitled "Contract for the construction of a combined cycle power plant"("Gas Annex"), which replaces the existing provisions of the Contract intheir entirety;

2) the parties to the Gas Annex responsible for the execution of theGas-Fired Project will be the Gas-Fired Project Contractor as thecontractor and the Gas-Fired Project Employer as the investor (orderingparty);

as a result, General Electric Global Services GmbH with its registeredoffice in Baden, Switzerland, has replaced the previous participant onthe Contractor's side, while EO, acting as the employer, has beenreplaced by CCGT Ostrołęka Sp. z o.o., with EO no longer being aparticipant in the Gas-Fired Project and, as a consequence, having norights or obligations under the Gas Annex;

3) the terms and conditions for the settlement of works completed duringthe performance of the Contract, preceding the suspension of itsperformance (see the Issuer's Current Report No. 5/2020 of 14 February2020) and following the suspension period until the entry into force ofthe decision to change the technology and define the subject matter ofthe investment project as the construction of a combined cycle powerplant (in place of a coal-fired power plant - see the Issuer's CurrentReport No. 21/2020 of 2 June 2020), are governed by the agreemententered into by and between EO and the Coal-Fired Project Contractorregarding the settlement of the Coal-Fired Project under the Contractfor the construction of the Ostrołęka C Power Plant ("SettlementAgreement").

II. The Settlement Agreement governs the rights and obligations of bothEO and the Coal-Fired Project Contractor chiefly in respect of thesettlement of works completed by the Coal-Fired Project Contractor aspart of the execution of the project, in the area of construction worksuntil their cessation due to the suspension of the performance of theContract, maintenance and protection activities carried out during theContract suspension period and works related to the completion of worksdedicated to the execution of the Coal-Fired Project. Under theagreement, accounts for the execution of the Coal-Fired Project will besettled by the end of 2021, and the total amount payable by EO to theCoal-Fired Project Contractor, taking into account the expendituresincurred to date, will not exceed PLN 1.35 billion (net of VAT).

Please be advised that the specific structure of the Contract AmendmentDocument is intended to enable the execution of the Gas-Fired Project byCCGT Ostrołęka Sp. z o.o. as a company that will replace EO in theexecution of the investment project in Ostrołęka, because the Issuer andEnerga S.A. (as shareholders of EO), on 22 December 2020, entered intoagreements (as was disclosed by the Issuer in Current Report No. 56/2020of 22 December 2020), in which ENEA S.A. confirmed its withdrawal fromparticipation in the Gas-Fired Project, and at the same time the partiesagreed that the Gas-Fired Project would be executed by a company towhich the assets for the execution of the Gas-Fired Project would betransferred. CCGT Ostrołęka Sp. z o.o. has been established as a specialpurpose vehicle dedicated to the performance of one of the saidagreements (the Split-Up Agreement). Accordingly, on 25 June 2021, itentered into an agreement with EO to acquire EO's enterprise, to enablethe execution of the Gas-Fired Project, as was disclosed by the Issuerin Current Report No. 20/2021 of 25 June 2021.

The structure of the Contract Amendment Document along with the relatedSettlement Agreement fulfills the need to perform another agreemententered into on 22 December 2020, the execution of which was disclosedby the Issuer in Current Report No. 56/2020 of 22 December 2020. Thesigning of the said agreement followed from the performance of theagreement of 22 December 2020 entered into by and between the Issuer andEnerga S.A. on cooperation in the settlement of the Coal-Fired Project,that is the Settlement Agreement, providing that the costs of theCoal-Fired Project would be settled pro rata by the parties thereof(Energa S.A. and the Issuer) in accordance with existing rules andwithin the limits adopted in the agreement entered into by and betweenthe Issuer and Energa S.A. on 30 April 2019, the execution of which wasdisclosed by the Issuer in Current Report No. 12/2019 of 30 April 2019.The Issuer will report on the final settlement of all costs related tothe Coal-Fired Project in a separate current report.

The Issuer is in the process of reviewing the anticipated extent of theimpact of this event on its financial performance in the currentreporting period.