G Energy Spolka Akcyjna

Legal Proceedings Report • Feb 13, 2023

Conclusionof Subcontracting Agreements.ManagementBoard of G-Energy S.A. (GENERGY, Issuer, Subcontractor) with itsregistered office in Warsaw informs that today it received anotification of the acceptance of two Subcontracts for theimplementation of construction works concluded by the Issuer with thecompany KOTŁO-REM Sędziszów sp. z o.o. with its registered office inSędziszów (KOTŁO-REM, Contractor), which concern the performance ofconstruction works related to the reconstruction and commissioning ofthe S/C gas network in Limanowa in the area of ul. Sikorskiego, Bema,Starowiejska on the premises of PSG sp. z o.o. (Employer) of the Branchof the Gas Plant in Kraków, the area of operation of the Gasworks inLimanowa (Agreement 1) and construction and assembly works for PSG sp. zo.o. Branch of the Gas Plant in Wrocław covering the area of the Wrocławpoviat (excluding the towns of Sobótka and Strzegomiany) (Agreement2)Thesubject of the Agreement1 is the reconstruction and commissioning of theS/C gas network in the town of Limanowa in the area of ul. Sikorski,Bem. Starowiejska (Robota) jointly constituting the subject of theAgreement, including in particular:1)reconstruction of: a) gas pipeline S/C PE 100 RC SDR 17.6 TYP 2 dn 160,L = 877 m, b) gas pipeline S/C PE 100 RC SDR 17.6 TYP 2 dn 110, L = 474m. c) gas pipeline S/C PE 100 RC SDR 11 Ti^P 2 dn 63. L= 837 m. d) 56pieces of gas connections S/C PE 100 RC SDR 11 TYPE 2dn 25. L= 1062 m.100 f) 1 piece of gate valve DN 50 2) delivery of start-up media - ifrequired, 3) performance of works accompanying the reconstruction.Thesubject of the Agreement2 is the performance by GENERGY of:1)simplified gas connections (in accordance with Article 29a of theConstruction Law), where the Subcontractor is obliged to make theconnection together with the design documentation, 2) gas connectionsbased on the design documentation provided by the Ordering Party, 3) gaspipelines, sections of gas pipelines with connections, on the basis ofdocumentation design provided by the Employer, 4) performance of worksaccompanying the construction referred to in point from 1) to 3)necessary for comprehensive quality and full scope of the subject of theorder on site activities of the Gas Plant Branch in Wrocław covering thearea of the poviat Wrocław (excluding the cities of Sobótka andStrzegomiany 5) The Parties may agree that the Tasks will also beperformed outside the area of the Wrocław poviat (excluding the citiesof Sobótka and Strzegomiany), however, in the scope of a given Branch ofthe Gas Plant in Wrocław. The value calculated in the Order inaccordance with the unit prices specified in the offer form will beincreased by a factor taking into account the costs associated withmobilization of the Contractor's equipment outside the area of theWrocław poviat (excluding m. Sobótka and Strzegomiany) The coefficientreferred to above will be adjusted depending on the location of the taskfor each started 1 km of distance from the border of the Wrocław poviat(excluding the cities of Sobótka and Strzegomiany) The value of thesupplement will be the product of the coefficient and the distance fromthe border of the Wrocław poviat (with excluding the cities of Sobótkaand Strzegomiany) to the location of the task (the shortest route).Thetasks will be performed on the basis of separate Orders given to theSubcontractor by the Contractor or directly by PSG. The number of Tasksawarded to the Subcontractor under the Orders submitted during the termof the Agreement will depend on the actual number of gas networkconnection agreements,TheIssuer will receive a total remuneration for the performance of theSubject of the Agreement not higher than PLN 4,150,000.00 (in words:four million one hundred and fifty thousand zlotys), with the partiesagreeing to increase the amount of remuneration in the form of an annexto the Agreement.GENERGYfor the performance of the Subject of the Agreement1 will receive atotal remuneration not exceeding PLN 1,050,000.00 (in words: one millionfifty thousand zlotys, 00/100). The remuneration indicated above will beadjusted on the basis of the difference between the actual length of thenetwork and the number of connections subject toconstruction/reconstruction in relation to to that originally specifiedin the Annex to the Agreement.GENERGYfor the implementation of the Subject of the Agreement2 will receive atotal remuneration not exceeding PLN 3,100,000.00 (in words: threemillion one hundred thousand zlotys, 00/100).Thisamount will be increased by the due tax on goods and services (VAT) atthe rate applicable on the date of performance of the Subject of theAgreement. The remuneration covers all works and all costs related tothe performance of the Agreement. The contractor will be entitled toremuneration depending on the actual scope of work performed, calculatedon the basis of the material scope performed, included in the technical/ final acceptance report, as-built inventory and detailed costcalculation.TheIssuer undertook to complete the Subject of the Agreement1 by June 30,2023. The date of completion of the Subject of the Agreement is the dateon which the Parties sign the final acceptance report of the Workswithout reservations.TheAgreement2 was concluded for a period of 24 (in words: twenty-four)months from the date of its signing, with the proviso that within theindicated period KOTŁO-REM has the right to give Orders, and GENERGY isobliged to accept them, while the Parties agree that the term of theAgreement will end upon completion of the works performed as part of allawarded Orders, i.e. also after the date on which, in accordance withthe rule for calculating deadlines expressed in months, resulting fromthe Civil Code. Each party may terminate the agreement with a 6-monthnotice period, effective at the end of the calendar month.Ifthe Employer confirms the need to perform additional works, theSubcontractor will prepare a valuation of works in accordance with therules set out in the Regulation of the Minister of Infrastructure of May18, 2004 on determining the methods and grounds for preparing aninvestor's cost estimate, calculating the planned costs of design worksand the planned costs of construction works, specified in functional andutility program. The parties, through negotiations, will determine theconditions for the performance of additional works, in particular theamount of remuneration for their performance - on the basis of thevaluation (estimate) submitted for approval.TheOrdering Party is entitled to demand payment of contractual penalties,the value of which in relation to the Agreement may not exceed 20% ofthe total remuneration resulting from all orders received by theContractor.Theremaining detailed terms and conditions of the above-mentionedagreements do not differ from those commonly used in this type ofagreement.