PGNiG : Current Report No. 4/2017

2017.01.18 08:14 Current Report No. 4/2017

Warsaw, January 18th 2017
Execution of investment agreement concerning investment in Polimex-Mostostal S.A., and other agreements under the same transaction
Current Report No. 4/2017
Further to Current Report No. 123/2016 dated December 27th, 2016, the Management Board of Polskie Górnictwo Naftowe i Gazownictwo S.A. ('PGNiG') announces that PGNiG Technologie Spółka Akcyjna (the 'Company'), a subsidiary of PGNiG, executed on January 18th, 2017 the following agreements:

1.Investment agreement with ENEA S.A., ENERGA S.A., PGE Polska Grupa Energetyczna S.A. (jointly with the Company referred to as the 'Investors') and with Polimex-Mostostal S.A. ('Polimex'), under which, subject to conditions precedent stipulated therein, the Investors agreed to make an investment in Polimex. The investment purpose is to acquire jointly by the Investors up to 150,000,000 Series T ordinary bearer shares with a par value of PLN 2 (two złoty) per share, issue price of PLN 2 (two złoty) per share ('New Shares') issued by Polimex as part of Polimex's share capital increase of up to PLN 300,000,000 (three hundred million złoty) (the 'Investment Agreement'). Under terms of Investment Agreement the Company agreed to acquire 37,500,000 (thirty seven million five hundred thousand) of New Shares for total issue price of 75,000,000 (seventy five million złoty). In accordance with Resolution No. 4 of the Extraordinary General Meeting of Polimex held on December 28th, 2016, the offer of New Shares to Investors, the issue price and number of shares offered to Investors is subject to approval by Polimex's Supervisory Board. The Investment Agreement was executed subject to fulfilment of certain conditions precedent ('Conditions Precedent'), including:
(i) execution of a binding agreement between Polimex, Towarzystwo Finansowe Silesia sp. z o.o. ('TFS') and financial creditors of Polimex which sets out the terms of restructuring of Polimex's financial liabilities and in which financial creditors and TFS will approve the acquisition and takeover a joint control of Polimex by the Investors;
(ii) execution by Agencja Rozwoju Przemysłu S.A. ('ARP') and TFS of an agreement obliging ARP to sell and TFS to purchase 146 Series A convertible bonds issued by Polimex;
(iii) execution by SPV Operator sp. z o.o., a subsidiary of ARP ('SPV Operator'), and the Investors of an agreement obliging SPV Operator to sell to the Investors jointly 6,000,001 of Polimex's shares, subject to the fulfilment of Conditions Precedent or waiver thereof by the Investors;
(iv) adoption of a resolution by the Extraordinary General Meeting of Polimex concerning changes in the composition of the Supervisory Board of Polimex and amendments to the Articles of Association of Polimex, and filing by the Company of an application to the National Court Register for registration of the amendments to the Articles of Association.

2. Agreement between the Investors defining the rules of their cooperation and mutual rights and obligations in the investment executed under the Investment Agreement.

3. Agreement between the Investors and SPV Operator under which SPV Operator is obliged to dispose of total 6,000,001 of Polimex's shares to the Investors (subject to the fulfilment of Conditions Precedent), and the Company is obliged to acquire 1,500,000 of Polimex's shares.

4. Agreement between the Investors and TFS under which TFS agreed to grant to the Investors, for a consideration, an option to acquire Polimex's shares from TFS if TFS exercises the right to convert the convertible bonds issued by Polimex, and further agreed not to convert its holding of Series A convertible bonds issued by Polimex without a prior request to do so submitted by the Investors in writing.

Moreover, PGNiG informs, that on January 18th, 2017, after examining the application mentioned in Current Report No. 123/2016 dated December 27th, 2016, the President of Polish Office for Competition and Consumer Protection approved business concentration involving the acquisition of joint control of Polimex by the Investors.