PannErgy : GM – Proposals 1

PROPOSALS OF THE BOARD OF DIRECTORS

TO THE ORDINARY GENERAL MEETING RELATING TO

AGENDA ITEMS

CAPS COAF: HU20240307014138

• 1-4. Report of the Board of Directors on the Company's operations in the business year of 2023

• 5. Corporate Governance Report

• 6. Resolution on the evaluation of the work carried out by the members of the Board of Directors in the business year of 2023 and on granting the discharge they are entitled

• 7. Consultative vote on the Remuneration Report of the business year of 2023

• 8. Advisory vote on the amendment of the Company's Remuneration Policy

• 9. Resolution on the remuneration of the members of the Management Board

• 10. Authorisation of the Management Board to acquire own shares

• 11. Election of the Company's auditor, the establishment of its remuneration

• 12. Reduction of the Company's share capital by cancelling some of its treasury shares

• 13. Amendment of the of the Company's Articles of Association in relation to agenda items no. 10-12

With the resolution 2024.03.26/2 of the Management Board of PannErgy Plc. adopted the proposals related to the agenda items of the Annual General Meeting to be held on 18.04.2024/2024.04.301.

This announcement is published in Hungarian and English languages. In case of any contradiction between these two versions, the Hungarian version shall prevail.

1 According tot he date of the General Meeting

Proposal for the annual General Meeting regarding Agenda Item 1

"Report of the Management Board on the activities of the Company in the business year of 2023 - adoption of the report on the management, the Company's financial position and business policies" as well as Items 2, 3 and 4

Report by the Management Board concerning Agenda Items nos. 1 to 4 of the General Meeting:

In the business year 2023, the PannErgy Group continued the implementation of its mission to utilise geothermal energy resources. Accordingly, the subsidiaries operated geothermal projects at a high technical level, utilising the available geothermal resources at all production sites, including, in particular, in Győr, Miskolc and Szentlőrinc. With 1,705 TJ of heat sold in 2023, green heat sales underperformed both the 1,785 TJ peak reached in the base period and the 1,790 TJ target for 2023. Underperformance is mainly attributable to unfavourable weather conditions for geothermics and, with regard to the target, the postponement of the capacity expansion investment project in Miskolc.

The Company's consolidated sales revenue increased significantly, by 35%, year-on-year, primarily due to the recognition of significantly increased electricity costs related to the base period and certain parts of the reporting period, as justified costs related to district heat production, through regulated pricing applicable to the producer.

The Company's consolidated EBITDA hit a peak with HUF 3,930 million, which is consistent with the 2023 EBITDA target range published in the Quarterly Production Report for Q4 2023 on 15 January 2024 that projected an economic result around the lower end of the HUF 3,950- 4,150 million EBITDA target range. The consolidated EBITDA in the reporting year shows a 9% improvement year-on-year, outperforming the HUF 3,612 million EBITDA in the base year by HUF 318 million. The outstanding performance was achieved partly through efficient management and partly through the return on projects continuously aimed at increasing capacity, as well as improving efficiency and operational security.

The Company closed the business year 2023 with an IFRS consolidated net profit of HUF 1,716 million.

In 2024, the Company intends to continue its investment projects aimed at increasing capacity and improving efficiency, as well as operational security, with the goal of expanding and making more economically efficient the utilisation of energy in the geothermal resources explored, preserving the lifetime of existing systems, and making it possible that maintenance, emergency management and repair interventions are carried out as efficiently and safely as possible. Digging a new production well in Miskolc originally scheduled for 2023 and implementing comprehensive transformations intended for the mechanical adaptation of the new technologies and capacities created partly by the connection of the new production well are of key importance in this investment activity.

PannErgy Nyrt.

Cégjegyzékszám / Registered number: 01-10-041618 Telefon: [phone]; Fax: [phone]

Adószám / VAT reg. number: 10558377-2-43

EU adóigazgatási szám / EU VAT reg. number: HU10558377

CIB BANK SWIFT: CIBHHUHB

HUF IBAN: HU53 1070 0024 0250 2106 5110 0005

EUR IBAN: HU11 1070 0024 0250 2106 5000 0005

Through its completed investment projects, efficient and professional operation and, last but not least, the green and economical energy it offers, the Company expects to enhance the services provided for its existing customers and even provide new customers with geothermal energy in the future.

The armed conflict between Russia and the Ukraine that erupted in 2022 brought to light critical global, and also local, energy issues, at times in the form of extremely high and volatile raw material and energy prices, that are clear evidence of the special importance of green energy sources independent of fossil fuels, including geothermal energy. This is particularly true for Hungary.

Besides the related potential benefits for PannErgy inherent to the current geopolitical situation, the economic risks could pose many direct and indirect challenges to all economic operators, including our Company.

The Company plans to sell an annual quantity of heat of 1,773 TJ in 2024. The EBITDA target for 2024 is in the range of HUF 3,900 million to 4,100 million, with its mean representing a slight increase compared to the baseline EBITDA. This target range corresponds to the targets presented in the production report for Q4 2023 published by the Company.

The quarterly breakdown of heat sales pertaining to the EBITDA target has been presented in the

Business and Management Report of the "PannErgy Nyrt. and its subsidiaries - Consolidated Financial Statements and Annual Report for 2023 in conformity with the IFRS" and in the Company's

public quarterly production reports.

In 2023, the closing share price of PannErgy Nyrt. at the end of the year increased by 4.9% from HUF 1,315 per share to HUF 1,250.

With its resolution No 8/2023 (IV. 28.), the General Meeting closing the 2022 business year authorised the Management Board to purchase own shares in a value of up to HUF 900 million, at a share price of at least HUF 1 and at most HUF 1,670, for the period ending on 13 April 2024. During the authorisation period, the Management Board - taking into account the applicable legal framework - is authorised to purchase ordinary shares with a nominal value of HUF 20 up to a quantity with which the portfolio of treasury shares does not, at any time, exceed 25% of the total number of shares issued. The Company started purchasing at the Budapest Stock Exchange up to 2,000 PannErgy Nyrt. ordinary shares per day from the trading day 2 May 2023, 3,800 per trading day from 14 June 2023 and 5,000 per trading day from 19 December 2023.

Continuing to observe with particular attention the transparency requirements on the capital market, the Company published quarterly production reports and a half-year report in 2023 on its geothermal projects and overall operation. The reports have sought to disclose public information that goes beyond the statutory requirements.

For 2023, the Company prepared and published separate and consolidated statements, both in accordance with the EU IFRS, containing a business and management report on the results of the work by the Management Board as well as the operation of PannErgy Nyrt. and the PannErgy Group,

PannErgy Nyrt.

Cégjegyzékszám / Registered number: 01-10-041618 Telefon: [phone]; Fax: [phone]

Adószám / VAT reg. number: 10558377-2-43

EU adóigazgatási szám / EU VAT reg. number: HU10558377

CIB BANK SWIFT: CIBHHUHB

HUF IBAN: HU53 1070 0024 0250 2106 5110 0005

EUR IBAN: HU11 1070 0024 0250 2106 5000 0005

and also published several public announcements, knowledge of which is also essential for assessing the performance of the Group and the work of the Management Board.

The consolidated net earnings for the reporting year in accordance with the EU IFRS is HUF 1,716 million (profit), and the balance sheet total is HUF 26,252 million.

The standalone net earnings for the reporting year in accordance with the EU IFRS is HUF 344,723 thousand (profit), whereas the balance sheet total is HUF 10,107,706 thousand.

The Company publishes extraordinary and other announcements on shareholder information in accordance with laws in force, available, inter alia, on the websites of the Company and of the Budapest Stock Exchange.

The Audit Committee at the Company has examined the Company's statements and the auditors'

reports as well as the financial reporting processes in place at the Company, and deemed them acceptable.

As the public oversight authority responsible for the public oversight duties of auditors, the Accounting and Public Oversight Department of the Ministry of Finance carried out a quality control procedure to verify the audit activities conducted for the consolidated and individual annual reports of PannErgy Nyrt. for the business years 2021 and 2022. For 2021, the quality control procedure resulted in a "pass"; accordingly, the authority found the audit underlying the relevant audit reports and the robustness of the reports to be compliant.

In view of the financing needs of investment activities planned for 2024, the necessity of holding a certain level of free cash and cash equivalents required for safe and prudent operation and thus for maintaining a high level of financial and operational stability with adequate flexibility, the Management Board does not recommend the payment of dividends, and proposes that after-tax profit be transferred to retained earnings in full.

The Management Board submits the following draft resolutions of the General Meeting in connection with the agenda items 1-4 published.

DRAFT RESOLUTION:

Considering the report of the Management Board, the opinion of the Audit Committee and the auditor, the General Meeting accepts the report of the Management Board for 2023.

Considering the report of the Management Board, the opinion of the Audit Committee and the auditor, the General Meeting has accepted the Company's individual (parent company), non-

consolidated balance sheet, profit & loss account for 2023 as prepared in conformance to the EU

IFRSs, in line with the associated proposal and the auditor's report, with an identical total of HUF

PannErgy Nyrt.

Cégjegyzékszám / Registered number: 01-10-041618 Telefon: [phone]; Fax: [phone]

Adószám / VAT reg. number: 10558377-2-43

EU adóigazgatási szám / EU VAT reg. number: HU10558377

CIB BANK SWIFT: CIBHHUHB

HUF IBAN: HU53 1070 0024 0250 2106 5110 0005

EUR IBAN: HU11 1070 0024 0250 2106 5000 0005

10,107,706 thousand for assets and liabilities, and earnings after taxes, i.e. profit of HUF 344,723 thousand.

The General Meeting - considering the report of the Management Board, the opinion of the Audit Committee and the auditor - acknowledges and accepts the EU IFRS consolidated financial statements of the PannErgy Nyrt. Group on its operations in 2023, showing an identical total of HUF 26,252 million for assets and liabilities (balance sheet total), and net earnings, i.e. profit of HUF 1,716 million.

The General Meeting accepts the proposal of the Management Board, according to which the Company's earnings after tax are placed entirely in the accumulated profit reserve, and thus the Company does not pay any dividends.

* **

This announcement is published in Hungarian and English languages. In case of any contradiction between these two versions, the Hungarian version shall prevail.

PannErgy Nyrt.

Cégjegyzékszám / Registered number: 01-10-041618 Telefon: [phone]; Fax: [phone]

Adószám / VAT reg. number: 10558377-2-43

EU adóigazgatási szám / EU VAT reg. number: HU10558377

CIB BANK SWIFT: CIBHHUHB

HUF IBAN: HU53 1070 0024 0250 2106 5110 0005

EUR IBAN: HU11 1070 0024 0250 2106 5000 0005

PROPOSAL AND PROPOSED RESOLUTION

ON AGENDA ITEM 5 OF THE GENERAL MEETING "DECISION ON ADOPTING THE CORPORATE GOVERNANCE REPORT

TO BE SUBMITTED TO BUDAPEST STOCK EXCHANGE"

The Management Board proposes to the General Meeting the following decision for Agenda Item no. 5 of the General Meeting.

DRAFT RESOLUTION:

The General Meeting adopts the Corporate Governance Report to be submitted to Budapest Stock Exchange.

* * *

This announcement is published in Hungarian and English languages. In case of any contradiction between these two versions, the Hungarian version shall prevail.

PannErgy Nyrt.

H-1112 Budapest, Boldizsár u. 2. Hungary

Cégjegyzékszám / Registered number: 01-10-041618 Telefon: [phone]; Fax: [phone]

Adószám / VAT reg. number: 10558377-2-43

EU adóigazgatási szám / EU VAT reg. number: HU10558377

CIB BANK SWIFT: CIBHHUHB

HUF IBAN: HU53 1070 0024 0250 2106 5110 0005

EUR IBAN: HU11 1070 0024 0250 2106 5000 0005

PannErgy

Public Limited Company

Responsible Corporate Governance Report

in accordance with the Responsible Corporate Governance Recommendations of the Budapest Stock Exchange for the Annual General Meeting of the Company closing the 2023 financial year

Management Board of PannErgy Plc.

This announcement is published in Hungarian and English languages. In case of any contradiction between these two versions, the Hungarian version shall prevail.

KELER CAPS number: 10162

PannErgy Nyrt. (hereinafter: "the Company") is committed to operate while observing the relevant laws, the MNB's provisions and the stipulations of the BSE Regulations. The structure and operating conditions of the Company are set out in the Articles of Association adopted by the General Meeting. As far as responsible governance is concerned, PannErgy Plc. provides the following information.

Management Board

In lieu of a Board of Directors and a Supervisory Board, the Company has a Management Board in order to enable a consistent system of governance. The Management Board carries out the statutory functions of both the Board of Directors and the Supervisory Board. As part of its duties as the Board of Directors, the Management Board defines the Company's strategic policies and supervises its operation.

The Management Board currently has five natural person members, elected by the General Meeting for an indefinite term of office. The Chair of the Management Board is elected by the Board members from among their number. The member of the Management Board serving as the Chief Executive Officer or Acting Chief Executive Officer is appointed by the Board members from among their number.

The Management Board takes decisions with a simple majority. It has a quorum if the majority of its current members are present. In the event of a tie, the Chairman of the Management Board shall have the casting vote.

The Management Board shall establish its own rules of procedure, containing a detailed description of its duties and procedures falling within its competence.

The Management Board shall prepare a report to the General Meeting on the Company's management, financial position and business policy at least once a year.

The Management Board directly governs the Company and is responsible for carrying out financial duties and implementing its resolutions and decisions. The employer's rights over the Company's direct employees are exercised by the Acting Chief Executive Officer or the Chief Executive Officer.

The Management Board shall comprise the following members:

Dénes Gyimóthy, Chair - independent

Gábor Briglovics, member - independent

Katalin Gyimóthy, member - independent Attila Juhász member - independent

Kálmán Rencsár member - independent

As of 12 December 2022, the CEO duties are performed by István Jaksa.

In 2023, the Management Board met on 9 occasions, with an average participation rate of 75%, and adopted written once resolutions without a meeting.

Audit Committee

In order to ensure that the functions of the Management Board are carried out and sound decisions are made, the Company's General Meeting has elected a three-member Audit Committee out of theindependent members of the Management Board.

The Audit Committee's duties include commenting on the report prepared in accordance with the IFRS,

assessing the functioning of the financial reporting system, making proposals on the appointment and remuneration of the auditor, preparing the auditor's contract and carrying out the tasks related to the

cooperation with the auditor. Moreover, the Audit Committee regularly monitors whether the classification of transactions between the Company and related parties was appropriate in terms of the identification, public disclosure and regular handling of significant related transactions.

The Audit Committee lays down the rules governing its operation and decision-making. In the 2023 financial year, the members of the Audit Committee were as follows:

Attila Juhász, Chair

Gábor Briglovics, member Kálmán Rencsár, member

In 2023, the Audit Committee met on 5 occasion, at a participation rate of 100%.

Other committees

The Company does not have a nominations committee or a remuneration committee. These functions are fulfilled by the members of the Management Board as appropriate. The Company operates with a small number of staff and with a narrow scope of activities, therefore establishing various committees and management bodies offers doubtful benefits.

Auditor

The Company's auditor is elected by the General Meeting for a term of 1 year.

The Company's auditor: BLUE RIDGE AUDIT HUNGARY Kft.

The auditor is proposed by the Audit Committee; the proposal is put forward by the presiding officer of the General Meeting that elects the auditor. In the event the candidate of the Audit Committee does not get elected by the General Meeting as the Company's auditor, the Audit Committee shall nominate another person.

The auditor is responsible for auditing the Company's books, submitting a report to the General Meeting on the audit of the reports of the Company under the Accounting Act and the proposal by the Management Board on the distribution of profit and the calculation of dividends, and exercising other rights and carrying out other duties under the law.

During the 2023 financial year, the auditor carried out no activities for the Company other than auditing and the related statutory obligations.

The Company's disclosure policy

With respect to its disclosure policy, the Company acts in accordance with the applicable legislation and stock exchange rules. The Company shall publish its notices on its own website, the website of the Budapest Stock Exchange and on a website specified by the MNB. The publication of notices on the Company's website(www.pannergy.com)shall replace all other disclosure obligations unless otherwise provided by the law and other applicable regulations.

The Company's insider trading policy

With respect to insider trading, the Company acts in accordance with the applicable legislation and stock exchange rules. It has an Insider Trading Policy regulating the relevant activities, and holds records on the permanent and ad hoc insiders.

Exercising shareholder rights, presence at the General Meeting

The Company's capital stock consists of 20,000,000 dematerialised registered ordinary shares of the nominal value of HUF20 (twenty) each, representing equal membership rights and constituting a single series of shares. At the General Meeting of the Company, each shareholder shall have one vote per ordinary share.

On behalf of the Company's Management Board, the entity authorised by the applicable law to keep

the record of shareholders (currently the KELER Central Depository Ltd.) keeps a record of shareholders and shareholders' proxies.

Shareholder's rights may be exercised vis-à -vis the Company by any person whose name is registered in the record of shareholders. Shareholders' proxies may exercise shareholder's rights vis-à -vis the

Company after they have been registered in the record of shareholders as a shareholder's proxy.

The rules of procedure related to shareholder verification requested in connection with the closing of the record of shareholders prior to the General Meeting are set out in the regulations of KELER Central Depository Ltd. as amended from time to time.

The Company's supreme body is the General Meeting, which consists of the entirety of shareholders.

An annual General Meeting must be held once a year, respecting the statutory time-limit. The agenda of the annual General Meeting shall by all means include the following:

• - the report by the Management Board on the Company's business activities in the previous financial year;

• - adopting the Company reports according to the EU-IFRS and a proposal by the Management Board on the distribution of profit and the calculation of dividends;

• - determining the remuneration due to members of the Management Board and the auditor;

• - adopting the responsible corporate governance report to be submitted to the Budapest Stock Exchange;

• - adopting a decision on the evaluation of the work carried out by the members of the Management Board in the previous financial year and on granting the discharge they are entitled to.

An extraordinary General Meeting may be convened by the Management Board when it is considered appropriate for the operation of the Company.

An extraordinary General Meeting shall be convened by the Management Board if the previous General Meeting so decided and if it has been requested from the Management Board in writing by the auditor or shareholders representing at least 5% of all votes, the latter specifying the reasons for and the purposes of convening the General Meeting.