CONCLUSION OF CONNECTION AGREEMENT BY SUBSIDIARY

The Management Board of Polenergia S.A. (“Issuer”), in reference to the Issuer’s current report with No. 8/2019 hereby reports that on 29 January 2021, MFW Bałtyk I S.A. (“Company”) controlled by MFW Bałtyk I Sp. z o.o. where the Issuer holds 50% shares, developing an offshore wind farm project, MFW Bałtyk I (Bałtyk Północny) (“Offshore Wind Farm Project”) signed an agreement with Polskie Sieci Elektroenergetyczne S.A. (“Operator”) with respect to the connection of the Offshore Wind Farm Project to the Operator’s network (“Agreement”).

Pursuant to the Agreement, the total generating capacity of the Offshore Wind Farm Project was determined on the level of 1560 MW.

The Agreement specifies investments on the side of the Company and the Operator, which will be necessary for ensuring the connection and power evacuation from the Offshore Wind Farm Project, as well as other terms of the connection,  also in relation to the procurement of land by the Operator for the needs of network investments.

The Agreement contains standard provisions applied by the Operator for agreements of this type, in particular:

1)    The Agreement does not guarantee evacuation of power until the moment of extension of the network by the Operator;

2)    The Company shall settle a fee for the connection in the amount that is an equivalent for the actual outlays of the Operator made with respect to the connection. The Agreement contains terms pertaining to the settlement of the fee and verification of its amount;

3)    The Agreement sets out the cases of its termination, in principle related to the violation by the Company of material obligations resulting from the Agreement or resignation from performance of the Offshore Wind Farm Project;

4)    Delays in performance of the connection are subject to liquidated damages stipulated for both parties.

Legal basis: Art. 17(1) of Regulation of the European Parliament and Council (EU) No. 596/2014 on market abuse and repealing Directive 2003/6/EC of the European Parliament and Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (Journal of Laws of the European Union L of 2014, No. 173, p. 1 as amended).