Enea S.A. — Share Issue/Capital Change 2017

Mar 31, 2017

Current Report No.: 14/2017

Date of publication: 31.03.2017

Short name of issuer: Enea S.A.

Subject: Conclusion of an investment agreement

Legal basis: Article 17 item 1 of MAR - confidential information

Content of report:

In relation to the current report No. 13/2017 dated 30 March 2017 theManagement Board of Enea S.A. ("Company") informs that on 31 March 2017the Company concluded:

1.an investment agreement specifying the conditions for the financialinvestment in Polska Grupa Górnicza sp. z o.o. ("PGG") ("Investment")("Investment Agreement");

2.memorandum of understanding relating to the exercise of a jointcontrol over PGG ("Investors' Memorandum of Understanding").

Investment Agreement

The parties to the Investment Arrangement include the Company, ENERGAKogeneracja sp. z o.o., PGE Górnictwo i Energetyka Konwencjonalna S.A.,PGNiG TERMIKA S.A., Węglokoks S.A., Towarzystwo Finansowe Silesia sp. zo.o., Fundusz Inwestycji Polskich Przedsiębiorstw Fundusz InwestycyjnyZamknięty Aktywów Niepublicznych (further on referred to jointly as"Investors") and PGG. The Investment Agreement foresees that PGG willacquire the selected mining assets from Katowicki Holding Węglowy S.A.("KHW") based on the final agreement which is to be executed on 1 April2017 ("Purchase Agreement").

The Investment Agreement regulates the course of the Investment and theCompany's entering into PGG, principles of operation of PGG and itsauthorities, and also the terms under which the parties may exit fromthe investment in PGG. The Agreement foresees the recapitalisation ofPGG in three stages by the Company, ENERGA Kogeneracja sp. z o.o., PGEGórnictwo i Energetyka Konwencjonalna S.A., PGNiG TERMIKA S.A. andTowarzystwo Finansowe Silesia sp. z o.o. for the total amount of PLN 1billion.

As part of PGG recapitalisation the Company undertook to subscribe fornew shares in PGG with the total nominal value of PLN 300 million inconsideration for the contribution in cash amounting to PLN 300 million,in three stages:

a)as the first stage the Company will subscribe for the new shares inPGG totalling to PLN 150 million in consideration for the contributionin cash amounting to PLN 150 million. After taking up the shares theCompany will hold a 4.39% share in PGG's share capital. The firstrecapitalisation is to be performed in April 2017;

b)as the second stage the Company will subscribe for the new shares inPGG totalling to PLN 60 million in consideration for the contribution incash amounting to PLN 60 million. After taking up the shares the Companywill hold a 5.81% share in PGG's share capital. The secondrecapitalisation is to be performed in June 2017;

c)as the third stage the Company will subscribe for the new shares inPGG totalling to PLN 90 million in consideration for the contribution incash amounting to PLN 90 million. After taking up the shares the Companywill hold a 7.66% share in PGG's share capital. The thirdrecapitalisation is to be performed in Q1 2018.

The Agreement regulates the principles of appointing members of theSupervisory Board, according to which each of the Investors and theState Treasury will be entitled to nominate one member of theSupervisory Board composed of eight members maximally.

The Investment is in line with Enea Capital Group's Development Strategywhose one element is securing the base of commodities for theconventional power engineering.

Investors' Memorandum of Understanding

Pursuant to the Investors' Memorandum of Understanding, subject to thecondition of obtaining the consent of the President of the Office ofCompetition and Consumer Protection, the Company will take over a jointcontrol over PGG. The joint control will be exercised together withENERGA Kogeneracja sp. z o.o., PGE Górnictwo i Energetyka KonwencjonalnaS.A., PGNiG TERMIKA S.A., and Fundusz Inwestycji PolskichPrzedsiębiorstw Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych("Controlling Shareholders").

The Investors' Memorandum of Understanding regulates the principles ofdetermining a common position of the Controlling Shareholders as regardsthe decisions relating to PGG.

At the same time, in relation to the current report No. 33/2016 of 28October 2016 relating to the execution of letter of intent withWęglokoks S.A. and Towarzystwo Finansowe Silesia sp. z o.o. expressingthe preliminary interest in the financial engagement in KHW or KHW'sassets ("Letter of Intent"), the Company informs that on 31 March 2017the Letter of Intent was terminated by the parties thereto.