Prysmian S p A : REPORT ON SHARE CAPITAL INCREASE AIMING AT BONDS CONVERSION. POINT 1 OF THE AGENDA (EXTRAORDINARY SESSION)

REPORT BY THE BOARD OF DIRECTORS OF PRYSMIAN S.P.A. ("PRYSMIAN" OR THE "COMPANY") TO VOTE, AS ITEM NUMBER ONE OF THE AGENDA OF THE EXTRAORDINARY SESSION OF THE SHAREHOLDERS' MEETING SCHEDULED ON 28 APRIL 2021 (THE "SHAREHOLDERS' MEETING"), THE CONVERSION OF AN EQUITY LINKED BOND INTO SHARES AND TO INCREASE THE SHARE CAPITAL FOR THE PURPOSES OF SAID CONVERSION, PREPARED PURSUANT TO ART. 2441, PAR. 6 OF THE ITALIAN CIVIL CODE, ART. 72 OF CONSOB RESOLUTION NO. 11971 OF 14 MAY 1999 AS SUBSEQUENTLY AMENDED AND SUPPLEMENTED, AND ART. 125-TER OF LEGISLATIVE DECREE NO.58 OF 24 FEBRUARY 1998 AS SUBSEQUENTLY AMENDED AND SUPPLEMENTED

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1. Authorization to convert, pursuant to art. 2420-bis, paragraph 1 of the Italian Civil Code, the equity linked bond resolved by the Board of Directors on 25 January 2021, directed exclusively to qualified investors and with nominal value of euro 750,000,000.00. Consequent share capital increase pursuant to art. 2420-bis, paragraph 2 of the Italian Civil Code, in installments, without option rights pursuant to art. 2441, paragraph 5 of the Italian Civil Code, for the purposes of converting said convertible bond for a maximum nominal value of euro 1,864,025.50 through the issue of a maximum of 18,640,255 Company's ordinary shares with nominal value of euro 0.10 each. Amendment of article 6 of the Articles of Association. Resolutions related thereto. Granting powers with regard to the transaction.

Dear Shareholders,

The Board of Directors has decided to convene an Extraordinary Shareholders' Meeting to submit for your approval the proposal to authorize the conversion into Company's shares of the euro 750 million equity linked bond due on 2 February 2026 and directed exclusively to qualified investors, issued on 25 January 2021 under the name "Prysmian S.p.A. Euro 750,000,000 Equity Linked Bonds due 2026" (the "Bond"). You will also be invited to approve, for the purposes of said conversion, a share capital increase against cash contributions, indivisible way, without option rights pursuant to art. 2441, par. 5 of the Italian Civil Code, for a maximum nominal value of euro 1,864,025.50 to be paid in one or more tranches, through the issue of a maximum of 18,640,255 Company's ordinary shares having the same characteristics as the outstanding ordinary shares (the "Share Capital Increase").

The proposed Share Capital Increase is therefore instrumental in allowing the Company to convert the Bond - if so authorized by the Extraordinary Shareholders' Meeting - into newly issued shares and, at its discretion, treasury shares held by the Company.

This report aims to describe the proposal to increase the share capital pursuant to article 2441, paragraph 6 of the Italian Civil Code, art. 72 of the regulation adopted with CONSOB Resolution no. 11971 of 14 May 1999 as subsequently amended, and art. 125-ter of Legislative Decree no. 58 of 24 February 1998 as subsequently amended.

1. Transaction details

1.1 Reasons for the Share Capital Increase and allocation thereof

The proposed Share Capital Increase under the terms described above is part of the Bond issue transaction, addressed exclusively to qualified Italian and foreign investors, except investors from the United States of America, Australia, Canada, Japan and South Africa, and, in any case, with the exclusion of the general public. Said issue was resolved by the Board of Directors on 25 January 2021, with pricing defined by the Board on 26 January 2021.

The main features and objectives of the Bond are listed below.

Features and objectives of the Bond issue

On 25 January 2021, the Board of Directors approved the issue of the bonds ("Bonds") and the main terms and features of the Bond. The placement took place on 26 January 2021and on the same date the Board of Directors set the pricing of the transaction. The transaction was settled through the issue of securities and payment of the subscription price on 2 February 2021. The amount of the Bond is euro 750 million.

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The Bond was placed on the domestic and international market of qualified investors (as defined by applicable regulations) in equity linked instruments due to the complexity of the instruments offered and the desire to ensure the successful outcome of the transaction in a short time. The offer of the Bond to qualified investors made it possible to quickly raise funds from the non-banking capital market, thereby allowing the Company to take advantage of the opportunities offered by the favorable market environment and of the placement conditions deriving from the equity linked nature of the Bond. The Board of Directors believes that the Bond issue is in the interests of the Company, which has completed its fund raising on the medium-term securities market at favorable terms and conditions.

The main advantages of the transaction as it has been structured include:

• the opportunity to timely benefit from the positive market conditions through quick placement to institutional investors;
• the raising of funds at favorable conditions, also in light of the equity linked nature of the Bonds;
• a broader diversification of financial resources;
• increase of the Company financial flexibility;
• extension of the average bond maturity.

The funds raised shall be used to:

• finance the partial repurchase of the convertible bond issued by the Company on 17 January 2017 as well as its redemption at maturity; and
• pursue the Company purpose.

Purposes of the Share Capital Increase relating to the conversion of the Bond

The Bond Regulation (the "Regulation") provides that, should the Shareholders' Meeting not approve the Share Capital Increase for the purposes of the conversion of the Bonds by 30 June 2021 (the "Long-StopDate"), the Company may, within a limited period not exceeding 10 trading days after the Long-Stop Date, issue a specific notice addressed to the bondholders (the "Shareholder Event Notice") and proceed to the early redemption of the entire Bond by paying in cash an amount equal to the higher of

1. 102% of the principal and (ii) 102% of the fair value of the Bonds (according to the Regulation).
   If, subsequent to the failure of the approval of the Share Capital Increase by the Shareholders' Meeting , the Company does not issue the Shareholder Event Notice within the time limits specified in the Bond Regulation (and, in specific circumstances, even before that date), each bondholder may, within the time limits specified in the Regulation, request early redemption in cash of the Bonds held. In this case, the Company shall pay an amount in cash, so called, "Cash Alternative Amount" settled in compliance with the Regulation.
   However, if the Extraordinary Shareholders' Meeting decides to authorize the conversion of the Bond and to consequently increase the share capital with exclusion of the option right pursuant to art. 2441, par. 5 of the Italian Civil Code for the purposes of the conversion of the Bond, the Company shall be required to send, within 5 business days from recording the shareholders' meeting resolution with the Business Register, a specific notice to the bondholders (the "Physical Settlement Notice") based on which the bondholders shall receive, on the date specified therein (the "Physical Settlement Date"), the right to convert their bonds into outstanding and/or newly issued ordinary shares of the Company.
   The potential conversion of the Bonds into newly issued shares shall allow the Company to strengthen its capital structure and diversify its financial structure while limiting the

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related cash outflow for financial expenses and expiring capital, as well as to expand its shareholding structure thanks to qualified investors.

For the reasons above, the Company's Board of Directors believes it is important that the Bonds may be converted into Company's shares.

As indicated above, the reasons for the exclusion of the option right, pursuant to art. 2441, par. 5 of the Italian Civil Code, insofar as the proposed share capital increase, are those that led to the Bond issue, also taking into account the strengthening of the capital structure and the expansion of the shareholding structure that the potential conversion of bonds into shares would allow.

The Board of Directors therefore believes that the exclusion of the option right pursuant to art. 2441, par. 5 of the Italian Civil Code is fully justified in light of the features, timescales and objectives of the Bond.

1.2 Features of the Bonds

Pursuant to the resolutions of the Board of Directors and the Regulation's terms and conditions, the features of the Bond are as follows:

• Bond type: equity linked bond, with the possibility of conversion into ordinary shares of the Company (newly issued or treasury shares) subject to authorization by the Extraordinary Shareholders' Meeting and approval of a related share capital increase excluding the option rights, as indicated herein (reference should be made to "Conversion Right");
• amount: Euro 750 million;
• duration: five years maturing on 2 February 2026;
• currency: Euro;
• unit amount: Euro 100,000;
• recipients: qualified investors, except investors from the United States of America, Australia, Canada, Japan and South Africa, and, in any case, with the exclusion of the general public;
• listing: the bonds are expected to be listed on a regulated market or a multilateral trading system (such as the Third Market of the Vienna Stock Exchange) by 30 June 2021;
• issue price: 102,50% of their nominal value;
• interest rate: 0% (zero coupon);
• interest payments: not applicable;
• redemption: the principal shall be repaid in a single tranche equal to the nominal value, upon maturity of the Bond.
• The Company shall be entitled to early and full redemption of Bonds in the cases detailed in the Bond Regulation, in line with market practices, including:
• 1. at a indexed value to the underlying shares' market price, if the Share
     Capital Increase for the purposes of the conversion is not approved by the Long-Stop date (i.e. by 30 June 2021). Reference should also be made to "Conversion Right" herein;
  2. at the nominal value, starting from 12 February 2024, if the trading price of the Company's ordinary shares increases over 130% of the conversion price within a specified period;
  3. at the nominal value in the event of conversion, redemption and/or repurchase of the Bonds of at least 85% of the original nominal value of the Bond;
  4. at the nominal value, if specific changes in the tax regime take place which affect the Bonds.

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Furthermore, in the event of a change in control, each bondholder shall be entitled to request early redemption at the nominal value. Pursuant to the Regulation, a change in control shall be considered to have taken place if one or more individuals together acquire a percentage in the Company share capital higher than the threshold set from time to time by the regulations on mandatory public takeover bids (regardless of the applicability of an exemption pursuant to these regulations) or the right to appoint the majority of the Company's directors.

• conversion right: subject to a resolution of the Extraordinary Shareholders' Meeting authorizing the conversion of the Bonds and approving the share capital increase for this conversion, the Company shall be required to disclose to the bondholders the aforementioned Physical Settlement Date, that is the date from which they shall be granted the right to convert the Bonds into outstanding and/or newly issued ordinary shares of the Company. If the
  Extraordinary Shareholders' Meeting does not approve the Share Capital Increase by 30 June 2021, each bondholder shall be entitled to request early redemption in cash of the Bonds held, at a value that shall be indexed to the market price of underlying shares (determined in compliance with the Regulation), and also the Company shall be entitled, within a limited period following the Long-Stop Date, to proceed with the early redemption of the entire loan through the payment of a premium, that is, payment in cash of an amount equal to the higher of (i) 102% of the principal and (ii) 102% of the fair value of the Bonds (according to the Regulation).
• The initial conversion price of the Bonds into outstanding and/or newly issued ordinary shares of the Company is euro 40.2355 per share, without prejudice to any adjustments to the conversion price. The nominal value of the shares to be issued in the event of a conversion cannot exceed the amount payable to the bondholders as redemption of the Bonds in the event of non-conversion. The conversion price shall be allocated to the nominal price of the subscribed shares and, the remaining, to the share premium. The number of shares to be issued or transferred for the purposes of the conversion shall be determined by dividing the nominal value of the Bonds, for which the conversion right shall be exercised, by the conversion price on the relevant conversion date, rounded down to the nearest whole number of ordinary shares, without prejudice to any cash adjustments. No fractions of shares shall be issued or delivered and no payment in cash or adjustment shall be carried out for such fractions. Given the aforesaid parameters and subject to approval by the Extraordinary Shareholders' Meeting, by way of example, the initial conversion ratio shall be equal to 2,485 shares for each Bond.
• adjustments to the conversion price: the Bond Regulation provides that the initial conversion price shall be adjusted pursuant to the market practices applicable to this type of debt instrument upon occurrence, among others, of the following events: merge or stock split, free share capital increase through allocation of profits or reserves to the share capital, distribution of dividends, issue of shares or financial instruments exclusively to shareholders, assignment of options, warrants or other rights of subscription/purchase of shares or financial instruments to the shareholders, issue of shares or assignment of options, warrants or other subscription rights, issue of financial instruments that are convertible or exchangeable into shares, change to the

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