Raising funding in capital markets with a limited impact on debt ratios – Hybrid, Equity-linked financing instruments

IBC Working Committee “Law, Banking, Finance”: Methods of overcoming the “perfect storm” in the finances of Gas industry without increasing the company's consolidated debt

UniCredit Bank AG

9 April 2021 Public Agenda

•1 Hybrid Capital Instruments • Key Features and Benefits • Market Overview • Trends and Outlook

2• Equity-linked Financing Instruments

3• UniCredit Capabilities in Hybrid and Equity-linked Financing

2 Public Overview key features and benefits of hybrid bonds

1 2 3 Hybrids – Key features and benefits

Anatomy of a typical “European style” hybrid bond Key advantages of hybrid capital

• Tenor: Min. 60y for 50% rating equity credit (EC) from all main Cost of Capital • Weighted avg. cost of capital "WACC" efficient agencies, must be perpetual for IFRS equity eligibility Optimization tool, cheaper than 50% equity/50% Snr debt mix • Non-Call Period: Typically between 5y-10y, up to 15y possible Non-dilutive • No dilution of existing shareholder base Equity • Ranking: Deeply subordinated IFRS Equity • Perpetual hybrid instruments usually count as • Optional Coupon Deferral: Key for rating & IFRS equity treatment Treatment equity under IFRS • Step-ups: Allowed, vary across rating agencies, max. 100bps in total to guarantee EC across all rating agencies Rating Leeway / • 50% EC hybrids support credit rating metrics, Equity Credit positive signaling effect to rating agencies • Dividend Pusher: Typically junior/parity pusher on deferred interest • Special Call Options: Issuer has the option to call the Notes in case Diversification • Diversification of funding mix and investor base of certain events like Tax / Rating / Accounting Tax • Hybrids are typically structured to achieve tax deductible coupons Investors require up to 300bps1) compensation for hybrid features deductibility

Leverage / equity impact from Issuers’ and Rating Agencies’ perspectives

Up to 100% equity in issuers’ reported 50% Equity Credit helps improving key metrics like net debt & gearing ratios metrics like FFO/Debt or Debt/EBITDA Issuer Rating agencies

Hybrid bond is an efficient, non-dilutive tool to optimize capital structure, reduce leverage

1) Current average Sub-Senior spread (ie, hybrid spread pick-up above senior) of 2020-2021ytd EUR hybrid transactions: 190bps; Gazprom Sub-Senior spread in 2020 EUR transaction: 188bps 3 Public Supply development and use of hybrid within O&G sector

1 2 3 Hybrids – Market overview European hybrid supply 2016-2021ytd Selected Oil & Gas hybrid issuers in 2018 vs today (across currencies in EUR bn equiv.) Oil & Gas Utilities Real Estate TelCo Amt. o/s Amt. o/s Hybrid in % Hybrid in % Issuer Consumer goods Chemicals Others YE2018 today of Snr bonds1) of equity2) 50 48 (EUR bn eq.) (EUR bn eq.)

BP - 10.4 21% 18% 40 ENI - 3.0 17% 9% 30 30 Gazprom - 2.2 10% 1%

22 OMV 2.0 3.3 37% 31% 20 19 16 Repsol 2.0 3.7 67% 20% 10 10 19 Total 9.3 12.3 31% 16%

Wintershall DEA - 1.5 38% 22% 4 5 0 1 1 2 2016 2017 2018 2019 2020 2021 Total / Average 13.3 36.2 32% 17%

Hybrid is becoming increasingly popular among corporate issuers, including O&G companies

Source: UniCredit, Bloomberg, Company information, as of 24 March 2021 4 1) Current outstanding hybrid volume divided by current outstanding senior bonds volume 2) Current outstanding hybrid volume divided by latest available shareholders‘ equity (excl. minorities) Public Market conditions remain attractive for Gazprom and other hybrid issuers

1 2 3 Hybrids – Trends & Outlook

Monthly EUR hybrid supply vs spread/rates development

12 Avg. iBoxx Subord. NFI: 2016-2021ytd: 240bps 700 Avg. 5y Mid Swap: 2016-2021ytd: 0bps Volume Issued (LS) 5y Mid Swap (RS) Iboxx Subordinated NFI (RS) UniCredit Research 10 2021 forecast 500 8 Supply: EUR 40-45bn1) Spread: 170bps 6 300 bps

4 182 170 Volume EUR bn EUR Volume 100 2 -36 -30 0 -100 2016 2017 2018 2019 2020 2021

1. Record EUR 16bn equiv. 2021ytd supply: Record supply for Q1 across currencies, busiest quarter ever in Euro. UniCredit Research sees 2021 issuance volume at EUR 40-45bn, ie at similar level compared to last year. 2. UniCredit expects investors to remain supportive but selective in primary: Conditions to stay attractive though investors are paying attention to secondary performance potential, will require Trends & premium on selected transactions amid steeper yield curves. outlook 3. ESG formats + defensive sectors is currently the best formula to achieve strong transaction results. That said, investors remain yield-hungry, willing to engage in high-beta transactions. In hybrid spread terms, our credit strategists see additional moderate tightening potential until year-end.

Source: UniCredit, Bloomberg, Markit, as of 24 March 2021 5 1) EUR iBoxx IG/HY supply (volume last year: EUR 40bn) Public Agenda

1• Hybrid Capital Instruments

2• Equity-linked Financing Instruments • Market Overview and Trends • Optional and Mandatory Convertible Bonds • Optional Exchangeable Bond

3• UniCredit Capabilities in Hybrid and Equity-linked Financing

6 Public Equity-linked Market Trends Energy sector has an important and improving share in global EQL issuance

1 2 3 EQL – Market Overview and Trends Global Equity-linked Issuance with Focus on Oil Gas and Utilities Sector EMEA EUR mn Asia Pacific EUR mn Americas EUR mn EUR bn Americas # Deals Asia Pacific # Deals EMEA # Deals EUR bn Oil&Gas&Utilities EUR mn Oil&Gas&Utilities # Deals 180 180 20 40 160 160 16 24 140 140 120 120 12 8 100 100 80 80 8 -8 60 60 40 40 4 -24 20 20 0 0 0 -40 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Focus on EMEA Use of proceeds EMEA Issuance (Rating) Opportunistic Capital strengthening Refinancing Investment grade Sub-investment grade Unrated Inv. / growth financing Acquisition financing 100% 100% 0% 4% 4% 2%4% 24% 11% 15% 24% 21% 22% 36% 75% 6% 47% 47% 48% 47% 75% 35% 4% 40% 27% 20% 45% 0% 38% 50% 6% 50% 16% 18% 12% 15% 1% 19% 2% 71% 1% 60% 59% 19% 25% 47% 25% 39% 37% 44% 36% 24% 40% 35% 19% 10% 0% 0% 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021ytd ytd

7 Public Gazprom: Equity-linked Financing Instruments leveraging on Gazprom own shares

1 2 3 EQL – Optional and Mandatory Convertible Bonds

Optional Convertible Bond Mandatory Convertible Bond

• Senior unsecured bond which offers bondholders the option to • Subordinated instrument that automatically converts into newly Description convert into new (or existing) shares of Gazprom during the life of issued Gazprom shares on maturity the bond at a pre-determined conversion price

 Cheap source of unsecured financing for Gazprom, with  Immediate Equity recognition for Gazprom substantial cost savings vs. a traditional public bond  Effective capital increase occurring at maturity, hence stock Pros  Allows Gazprom to tap different sources of demand dilution occurs after 3 years  Opportunistic market access, fast-track execution in 2 weeks (no  Quick and flexible execution with no requirement of prospectus prospectus, no roadshow)

Points of • Risk of dilution for Gazprom shareholders, albeit can be mitigated • Higher yield of the instrument when compared to a plain-vanilla Attention through anti-dilution features (cash / net share settlement) convertible bond

Other • Any potential dilution will be delayed and at a significant • Due to the nature of the instrument, mandatory convertible bonds considerations premium to reference share price have a higher yield compared to plain vanilla convertible bonds

• Debt instrument for rating agencies • 100% rating agencies equity credit Equity Credit • Option value booked as equity • NPV of coupons booked as debt, balance as equity

STMicroelectronics Zalando Delivery Hero ArcelorMittal Fiat Chrysler Telecom Italia

Recent EUR 1,000,000,000 EUR 1,750,000,000 USD 1,250,000,000 USD 2,875,000,000 EUR 1,300,000,000 Examples USD 1,500,000,000 Convertible Bonds Convertible Bond Convertible bond Mandatory Mandatory Convertible Bonds EUR 172,200,000 EUR 813,529,920 USD 750,000,000 Convertible Convertible Bond Accelerated Bookbuild Accelerated Bookbuild Accelerated Bookbuild Securities Joint Global Coordinator Joint Bookrunner Joint Global Coordinator Joint Bookrunner Senior Co-Bookrunner Co-Bookrunner Italy, Jul 2020 Germany, Jul 2020 Germany, Jan 2020 France, May 2020 Italy, December 2014 Italy, December 2013

8 Public Gazprom: Equity-linked Financing Instruments leveraging on Gazprom listed liquid stakes

1 2 3 EQL – Optional Exchangeable Bond

Optional Exchangeable Bond

Description • Senior unsecured exchangeable bond issued by Gazprom into Novatek shares and placed to Institutional Investors

 Disposal of the stake at a premium vs. market price  Partial upside retained Pros  Voting rights and dividends retained by Gazprom until exchange  Very flexible product that can be tailored to Gazprom needs, e.g. cash settlement and/or share redemption option

• No guarantee of disposal of underlying shares, leaving Gazprom exposed to the Novatek share price downside risk Points of Attention • Additional debt to impact Gazprom capital structure and credit profile

• Debt instrument for rating agencies Equity considerations • Option component can be booked in Equity and is subject to mark-to-market adjustment

UniCredit Pekao ACS / Iberdola Hungary / CAMFIN / Pirelli Gedeon Richter

Recent Examples EUR 517,883,304 Mandatory Certificates EUR 405,600,000 EUR 903,800,000 EUR 150 mn into Bank Pekao shares Exchangeable Bond Exchangeable Bond Exchangeable Bond

Joint Bookrunner Joint Bookrunner Joint Bookrunner Joint Bookrunner Italy, Dec 2016 Spain, March 2014 Hungary, 2013 Italy / 2012

9 Public Summary overview of available instruments

Mandatory Convertible Optional Convertible Optional Exchangeable Bond Hybrid Bond Bond Bond

• Senior unsecured bond • Subordinated instrument • Deeply subordinated offering investors the • Senior unsecured bond that automatically converts financial debt instrument option to convert into new issued by Gazprom into Description into newly issued Gazprom that embed certain equity (or existing) shares of the Novatek shares on maturity features issuer at a premium conversion price

 Immediate Equity  Non-dilutive instrument,  Cheaper than straight bond recognition for Gazprom considerably cheaper than  Cheaper than straight bond or equity with effective capital straight equity or equity increase occurring at  Disposal of the stake at a Pros maturity  Coupon payments typically  Tap different sources of premium vs. market price tax deductible demand  Quick and flexible  Very flexible product that execution with no  Diversification of capital  Very flexible product can be tailored to Gazprom requirement of prospectus structure & investor base needs

• Dilution at maturity • Permanency • Additional debt instrument • No guarantee of disposal of Points of • Higher yield when compared • More volatile compared to before conversion underlying shares Attention to other senior instruments Senior bonds • Risk of dilution • Additional debt instrument

• Debt instrument for rating Equity • 100% rating agencies • 50% equity credit from • Debt instrument for rating agencies Content equity credit rating agencies with market agencies • Option component can be • For IFRS: NPV of coupons standard structure • Option component booked booked in Equity and is booked as debt, balance as • 100% equity recognition for in Equity subject to mark-to-market equity IFRS (perpetual formats) adjustment

10 Public Agenda

1• Hybrid Capital Instruments

2• Equity-linked Financing Instruments • Market Overview and Trends • Optional and Mandatory Convertible Bonds • Optional Exchangeable Bond

3• UniCredit Capabilities in Hybrid and Equity-linked Financing

11 Public UniCredit – A leading advisor & bookrunner for EUR hybrid bonds

1 2 3 UniCredit capabilities – Hybrid bonds

EUR EMEA Corporate Hybrid bonds 2018-2021ytd UniCredit adding value Pos. Lead Manager Amount (EUR m) No. of issues Share (%) • UniCredit is a leading bookrunner in EUR hybrid space (37 transactions 1 BNP Paribas 8,755 48 9.2 in last ~3yrs) & recognized by issuers for our structuring expertise 2 Citi 6,363 42 6.7 3 BofA 5,817 28 6.1 • Global coordinator and/or sole structuring advisor roles for Repsol, EDP, 4 Barclays 5,495 31 5.8 OMV, Telefonica and Infineon underpin that UniCredit is a leading 5 UniCredit 5,240 37 5.5 player in the corporate hybrid universe 6 Deutsche Bank 5,189 34 5.5 • Repeating mandates from leading hybrid issuers like Telefonica, Total, 7 Goldman Sachs 4,885 26 5.1 OMV, EDP, Iberdrola, Engie and Enel affirm our credentials 8 JPMorgan 4,746 38 5.0 9 SG CIB 4,129 29 4.4 • We are currently mandated on the first green hybrid transaction of an 10 Santander 3,648 27 3.8 Issuer from core Europe that might materialize in the upcoming weeks Total 95,018 108 100.0 Selected EUR hybrid transaction highlights & UniCredit’s recent references

Repsol EDP • Opportunistic transaction aiming to strengthen the balance sheet • 3rd hybrid in a row with EDP where UniCredit acted as active bookrunner EUR 750,000,000 and increase financial flexibility EUR 750,000,000 • Strong execution dynamics despite softer markets with 43bp tightening Hybrid Bond • Repsol achieved its targets in terms of size & yield Green Hybrid Bond from IPTs landing with 0bp new issue premium PNC6 2.500% 60.5NC5.5 1.875% Rating Ba1/BB+/BB+ • 2.5% represents the lowest coupon ever on a Repsol hybrid bond • Strong green component of the investor base Sole Structuring Adv. • UniCredit acted as Sole Structuring Advisor & Joint Global Rating Ba2/BB • UniCredit acted as Sole Structuring Advisor Sole Structuring Adv. and Joint GloCo Coordinator March 2021 January 2021

Enel Telefónica Wintershall DEA Lenzing AG Engie Abertis Iberdrola Veolia Environnement EDF Merck KGaA

EUR 2,250,000,000 EUR 1,000,000,000 EUR 1,500,000,000 EUR 500,000,000 EUR 850,000,000 EUR 1,250,000,000 EUR 3,000,000,000 EUR 2,000,000,000 EUR 850,000,000 EUR 1,000,000,000 2-Tranche Hybrid Sustainability Hybrid 2-Tranche Hybrid Hybrid Bond Green Hybrid Bond Hybrid Bond 2-Tranche Hybrid 2-Tranche Hybrid Hybrid Bond Hybrid Bond PerpNC6.5 & NC9.5 2.375% PerpNC8.25 PerpNC5.5 & PNC 8 PerpNC5 5.75% PerpNC8 1.500% PerpNC5.25 3.248% PNC5.5 & PNC8.5 PNC5.5 & PNC8.5 PerpNC6.5 Rating 60NC6 1.625% Baa3/BBB-/BBB Rating Ba2/BB/BB+ Rating Ba1/BB+ Unrated Rating Baa3/BBB-/BBB+ Rating -/BB/BB+ Rating Baa3/BBB/BBB Rating Baa3/BB+ Baa3/BB-/BBB Rating Baa3/BBB+ Joint Bookrunner Joint Bookrunner Joint Bookrunner Joint Bookrunner Joint Lead Manager Joint Bookrunner Joint Bookrunner Joint Bookrunner Joint Bookrunner Joint Lead Manager March 2021 February 2021 January 2021 November 2020 November 2020 November 2020 October 2020 October 2020 September 2020 September 2020

Source: UniCredit DCM & Dealogic as of 22 March 2021 12 Public UniCredit leadership in Convertible Bond Demand Generation and Trading

1 2 3 UniCredit capabilities – Equity-Linked Leadership in Demand Generation

EUR 750mn ‘26 CB EUR 150mn ‘26 CB EUR 1.0bn ‘25 - ‘27 CB USD 1.5bn ‘25 - ‘27 CB EUR 550mn '28 CB EUR 1.75bn '24 - '27CB

LBBW UCG ISP #2 2,9% UCG #1 #3 UCG #2 #1 MB 22% #1 UCG Natixis 4.4% DB UCG HSBC UCG 15,7% 50,5% BNPP 24,2% 16.7% BNPP 21.1% 13.4% 19% 30% BNPP 9% 16% Demand 46,6% 11% Split by JPM MS 18.5% Citi Bookrunner 14% JPM MS 14.7% BNPP HSBC 19% CACIB 26,5% SocG 21,0% JPM Citi 25% 20,2% BNPP en Barc MS GS 28,2% 15.9% 21,0% 16.4% 26% 15% 16% LO / HF Demand 57% / 43% 43% / 57% 27% / 73% 38% / 62% 48%/52% 25%/75% % of capital ~7% ~5% ~4% ~3% ~5% ~9%

European Convertible Weighted Trading Share – Ranking(1) 2015 2016 2017 2018 2019 2020 Market Market Market Market Market Market # Bank # Bank # Bank # Bank # Bank # Bank Share Share Share Share Share Share 1 Deutsche Bank 13.6% 1 Deutsche Bank 13.9% 1 Deutsche Bank 13.6% 1 JP Morgan 14.3% 1 JP Morgan 14.7% 1 Jefferies 15.6% 2 BNP Paribas 9.7% 2 BNP Paribas 10.7% 2 JP Morgan 11.0% 2 Deutsche Bank 14.2% 2 UniCredit 12.4% 2 JP Morgan 14.6% 3 Barclays 9.1% 3 JP Morgan 8.6% 3 BNP Paribas 10.5% 3 UniCredit 10.8% 3 Jefferies 11.9% 3 Barclays 11.8% 4 JP Morgan 7.8% 4 Morgan Stanley 8.4% 4 UniCredit 9.1% 4 BNP Paribas 10.5% 4 Barclays 11.0% 4 Goldman Sachs 10.7% 5 BAML 7.5% 5 Barclays 8.1% 5 Barclays 8.0% 5 Barclays 10.2% 5 Goldman Sachs 8.5% 5 UniCredit 9.4% 6 Goldman Sachs 7.3% 6 Goldman Sachs 7.8% 6 Morgan Stanley 7.5% 6 EXANE 5.7% 6 BNP Paribas 7.3% 6 BNP Paribas 8.5% 7 Morgan Stanley 7.2% 7 UniCredit 6.4% 7 Goldman Sachs 6.6% 7 Morgan Stanley 4.6% 7 Citi 5.5% 7 Citi 6.0% 8 Nomura 6.0% 8 BAML 5.3% 8 EXANE 6.0% 8 Nomura 4.5% 8 Nomura 4.7% 8 Nomura 3.5% 9 Credit Suisse 6.0% 9 Nomura 5.1% 9 Nomura 4.3% 9 Goldman Sachs 3.9% 9 Exane 4.0% 9 Credit Agricole 3.1% 10 UniCredit 5.0% 10 EXANE 5.0% 10 BAML 4.2% 10 Citi 3.7% 10 Deutsche Bank 3.1% 10 BAML 3.0%

Source: Greenwich Associates (1) Source: Dealogic 13 (2) Each broker is assigned relationship points for each institution based on trading volume and long market value of the institution across four tiers and each broker's importance in trading to the institution (e.g., 1st,2nd,3rd, etc, most important broker). Convertible trading share shows each brokers' share of total points Public Disclaimer

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Corporate & Investment Banking UniCredit Bank AG as of 7 April, 2021

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