PGE Polska Grupa Energetyczna S.A.

M&A Activity • Mar 7, 2023

Signing of the initial agreement on setting-up of SPV for the nuclearpower plant construction project

The Management Board of PGE Polska Grupa Energetyczna S.A. ("PGE") withreference to the current report no. 48/2022 of October 31, 2022 onsigning of a letter of intent regarding a cooperation on the developmentof a nuclear power plant (the "Letter of Intent"), discloses that onMarch 7, 2023 PGE signed with ZE PAK S.A. (the "Parties") an initialagreement (the "Agreement") on setting-up a joint special purposevehicle (the "SPV").

In order to begin direct cooperation on project of construction ofnuclear power plant based on the Korean technology APR1400 (the "Nuclearpower plant") the Parties intend to set up jointly the SPV in form of ajoint-stock company based in Konin that will then acquire or subscribefor shares in a company with a task to pursue project of Nuclear powerplant construction with a potential share of technological partner.

The Agreement includes a summary of main terms of Parties' cooperationin terms of joint venture intended to participate in implementation ofNuclear power plant investment, including determination of corporategovernance rules and operations of the SPV and limitations in sellingshares of the SPV. The Parties will possess equal number of shares inthe SPV and corporate rules will be based on the rule of joint control.

Setting up the joint venture (i.e. SPV) by the Parties is dependent onthe obtaining the consent of the President of the Office of Competitionand Consumer Protection for concentration. The Parties intend to filefor the concentration consent immediately.

At the same time the Parties plan that the SPV, in the next stage ofcooperation will perform: (i) feasibility study, (ii) site survey, and(iii) environmental impact assessment for the needs of plannedconstruction of Nuclear power plant.

In case of circumstances that prevent setting-up of the SPV, PGE willrelease such information in form of the current report.