Update with respect to the cash distribution

To: Bucharest Stock Exchange

Financial Supervisory Authority

London Stock Exchange

Current report according to Article 99 letter (s) of the Rule book of the Bucharest Stock Exchange Market Operator, Title II, Issuers and Financial Instruments

Events to be reported:

Update with respect to the cash distribution approved on 28 February 2017

Franklin Templeton International Services S.à r.l., in its capacity as alternative investment fund manager and sole director ("Fund Manager") of Fondul Proprietatea S.A. (the "Fund"), would like to update shareholders regarding the status of the distribution to shareholders of RON 0.05 per share through the share capital decrease by reducing the nominal value of the shares, as approved by the Fund's Extraordinary Shareholders' Meeting Resolution no. 1 of 28 February 2017.

The ex-date of the distribution is 9 June 2017 ("Ex-Date"), while the payment date is 30 June 2017. However, in order for the share capital decrease to be effective, four conditions have to be met, out of which two are still pending at the time of this report, namely (i) the endorsement of the decrease by the Financial Supervisory Authority ("FSA"), and (ii) the registration of the decrease with the Trade Registry (possible only after FSA endorses the decrease).

Having complied with all additional requests from FSA on the endorsement request, the Fund Manager reasonably expects a response from the FSA to be received in due time, although possibly after the Ex - Date.

Franklin Templeton International Services S.à r.l., in its capacity of Sole Director of FONDUL PROPRIETATEA S.A.

Johan Meyer

Permanent representative

Report date:8 June 2017

Name of the issuing entity: Fondul Proprietatea S.A.

Registered office: 78-80 Buzești St.,7th floor, district 1, Bucharest, postal code 011017

Phone/fax number: Tel.: + 40 21 200 9600Fax: + 40 21 200 9631

Sole Registration Code with the Trade Register Office:18253260

Order number in theTrade Register:J40/21901/2005

Subscribed share capital: RON 5,742,226,025.22

Paid-up share capital:RON 5,534,852,985.72

Number of shares in issue:

10,074,080,746

Number of paid shares:

9,710,268,396

Regulated market on which the issued securities are traded:Shares on Bucharest Stock Exchange

GDRs on London Stock Exchange