The Management Board of Proguns Group S.A., with itsregistered office in Warsaw (the "Issuer"), hereby announces that on 13November 2025, the Issuer entered into an agreement (the "Agreement")with Zakłady Sprzętu Precyzyjnego Niewiadów sp. z o.o. ("ZSP Niewiadów")concerning cooperation in the production of 40 mm ammunition.

The purpose of the Agreement is to define theprinciples of cooperation between the parties in preparing andimplementing a joint project aimed at launching the production of 40 mmammunition. Pursuant to the terms of the Agreement, the cooperation willbe based on the technology, expertise, experience, and know-how of ZSPNiewiadów, including that acquired from a foreign partner, and on thecapital provided by the Issuer.

Under the Agreement, the parties have committed to co-finance theimplementation of 40 mm ammunition production, including covering costsrelated to production preparation, the purchase of production equipment,and the acquisition of manufacturing rights. The Issuer has agreed topay an advance of PLN 4,000,000 for this purpose.

The Agreement further provides that the parties will share profitsgenerated from the sale of 40 mm ammunition.

According to the provisions of the Agreement, the detailed terms ofcooperation between the parties in the production of 40 mm ammunitionwill be set out in a separate executive agreement, to be concluded onceZSP Niewiadów enters into a contract with the supplier of the ammunitionproduction technology. This means that the current Agreement is generalin nature and constitutes a framework for the development of long-termcooperation between the parties in the field of production andcommercialization of 40 mm ammunition.

The Issuer notes that the conclusion of the Agreement represents animplementation of the provisions of the Term Sheet signed with Forum 119Closed-End Investment Fund, Grupa Niewiadów-PGM S.A., and ZSP Niewiadów,as disclosed in Current Report ESPI No. 25/2025 dated 21 October 2025.

The Issuer further indicates that ZSP Niewiadów is part of the GrupaNiewiadów-PGM S.A. Capital Group, a well-established entity in both thedomestic and international defense industries. The company manufacturesammunition and other military products and possesses a productionfacility, machinery, and assets both movable and immovable used inthe production of ammunition and its components. ZSP Niewiadów holds alicense for the manufacture and trade of explosives, weapons,ammunition, and military-purpose products and has signed a Memorandum ofUnderstanding (MoU) with the manufacturer and owner of the technologyrights for 40 mm ammunition, from whom it intends to obtain thenecessary rights and competencies for production.

Following the implementation of the agreement referenced in CurrentReport ESPI No. 9/2025 dated 17 March 2025, the Issuer will become partof the Grupa Niewiadów-PGM S.A. Capital Group.