Terna — Capital/Financing Update 2024

Apr 4, 2024

TERNA SUCCESSFULLY ISSUES HYBRID GREEN PERPETUAL BOND WORTH € 850 MILLION

The issuance has been very successful in the market with maximum demand of around 4 times the offer and orderbook over € 3 billion

Rome, 4 April 2024 – Terna has today successfully launched an issue of perpetual, subordinated, hybrid, non-convertible, green, fixed rate bond for institutional investors, with a total nominal amount of € 850 million.

The issue, which received a very favourable market response with maximum demand of over € 3 billion, outstripping supply by approximately 4 times the offered amount, is characterized by high quality and broad geographical diversification of investors.

The single tranche bond, non-convertible, subordinated, green hybrid and perpetual, is non-callable for six years and has an issue price equal to 99.745%, with a spread of 214.2 basis points over the Midswap. The issue will pay an annual coupon of 4.750% until the first reset date scheduled on 11 April 2030 and will have an effective rate equal to 4.800%. From this date, if the bond has not been called, the hybrid bond will pay annual interests equal to the 5-year Euro Mid-Swap rate plus an initial spread of 214.2 basis points. This will be increased by a further spread of 25 basis points from 11 April 2035 and an additional increase of 75 basis points from 11 April 2050.

The hybrid bond issue is part of the financial strategy outlined in the new 2024-2028 Industrial Plan of the company led by Giuseppina Di Foggia and helps to strengthen the Group's balance sheet, further diversifying the investor base. The net proceeds from the issue will be used to finance the company's eligible green projects, selected or to be selected on the basis of Terna's Green Bond Framework, drawn up in compliance with the "Green Bond Principles 2021" published by the International Capital Market Association (ICMA) and the EU Taxonomy, aimed at facilitating sustainable investments.

The settlement date for the issue is scheduled for 11 April 2024.

An application will be made for the hybrid bond - at the time of the issue - to be listed on the Luxembourg Stock Exchange. It is also expected that the hybrid bond will be rated "Ba1" by Moody's and "BBB-" by Standard and Poor' and that its equity content will be equal to 50%.

Terna's hybrid green bond issue was placed by a pool of banks consisting of Banca Akros, BNP Paribas, CaixaBank, Crédit Agricole Corporate and Investment Bank, Goldman Sachs International, HSBC, IMI – Intesa Sanpaolo, J.P. Morgan, Mediobanca, Morgan Stanley, Santander, SMBC and Unicredit Bank.

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This press release (the "Press Release") (including the information contained herein) does not constitute or is part of an offering or an invitation to purchase the Notes issued by the Company. Furthermore, this Press Release does not constitute a recommendation by the Company or any other party to sell or buy the Notes, neither a prospectus or other offering document. No action has been taken or will be taken by the Company that would permit an offering to sell or an invitation to purchase the Notes in any jurisdiction where actions for such purposes are required. It is forbidden to distribute this Press Release in any jurisdiction where actions for such purpose are required. Individuals into whose possession this Press Release comes are required to inform themselves about and to observe any such restrictions. In particular, this Press Release (including the information contained herein) does not constitute or is part of an offering of the Notes in the United States of America, Japan, Australia or Canada and any other jurisdiction where the extension, dissemination or availability of the transaction (and any other transaction contemplated thereby) would breach any applicable law or regulation or require registration of such Securities in the relevant jurisdiction (the "Restricted Jurisdictions"). This Press Release shall not be distributed, directly or indirectly, in such Restricted Jurisdictions. The Notes have not been and will not be registered under the United States Securities Act of 1933, as subsequently amended (the "Securities Act"), nor under any law applicable to financial instruments of the United States of America or any other Restricted Jurisdiction and may not be offered or sold neither in the United States of America without a registration or a specific exemption from registration under the Securities Act nor in a Restricted Jurisdiction. The distribution of this Press Release may be restricted by regulatory provisions. Individuals in jurisdictions where this release is distributed, published or circulated should inform themselves of and comply with such restrictions. In the United Kingdom this Press Release is directed only to: (i) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), and qualified investors under Article 49(2) from (a) to (d) of the Order, and (ii) to whom this Press Release may otherwise be lawfully communicated (together being referred to as "Relevant Persons"). This Press Release must not be acted or relied upon by individuals who are not Relevant Persons. Any investment or investment activity, to which this Press Release relates, is considered in the exclusive interest of and only addressed to the Relevant Persons and will be undertaken only with Relevant Persons. Any person who is not a Relevant Person should not act on or rely on this release. The documentation relating to the issuance of the Notes is not and will not be approved by CONSOB (the Italian Securities Exchange Commission) pursuant to the applicable laws. Therefore, the Notes may not be offered, sold or distributed to the public in the territory of the Republic of Italy, other than to qualified investors, as defined by Article 2(1)(e) of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the "Prospectus Regulation") and any applicable legal or regulatory provision or in other circumstances in which an exemption from the obligation to publish a prospectus is applied, by Article 35(1)(d) of CONSOB Regulation No. 20307 of 15 February 2018, pursuant to Article 100 of Legislative Decree No. 58 of 24 February 1998 (the "Consolidated Finance Act"), as

amended, and pursuant to Article 34-ter of CONSOB Regulation No. 11971 of 14 May 1999 (the "Issuers Regulation"), as amended from time to time, or in the other circumstances set forth under Article 100 of the Consolidated Finance Act or the Issuers' Regulation or the Prospectus Regulation, in any case in compliance with laws and regulations or requirements imposed by CONSOB or other Italian Authority.