04.08.2015 17:45

In reference to current reports No. 2/2015 and 16/2015 the Management Board of TAURON Polska Energia S.A. ("Company") informs that on 4 August 2015 the Management Board adopted resolution concerning consent to submit an offer to purchase some assets of the Brzeszcze mine ("Assets") belonging to Spółka Restrukturyzacji Kopalń S.A. (Mine Restructuring Company, "SRK") in a public tender.

Based on the results of analyses and recommendations of the Company's advisors the Management Board gave consent to submit an offer to purchase some assets of the Brzeszcze mine on the following conditions:

- due to the risk of potentially having to return illegal public help the offer will be submitted only if the Assets are sold by SRK in a public tender,
- the purchase price will be a "token sum" of PLN 1,
- as the transaction should be off balance sheet, the offer to purchase the Assets will be submitted by a Special Purpose Vehicle (SPV) formed by Partners, including Małopolska Agencja Rozwoju Regionalnego (Małopolska Regional Development Agency),
- the offer will be submitted provided that the Partners sign Agreement defining the basic terms and conditions of joint investment prior to offer submission and then, before the day of signing the final Asset purchase agreement by the SPV, the Partners to the SPV sign an agreement defining in particular their mutual obligations towards each other,
- due to the business risk related to operation of the Assets and the necessity to guarantee profitability of the investment, before signing the final purchase agreement by the SPV, SRK should implement asset restructuring program, in particular:

a) reduce the number of permanent employees to 828,
b) have up to 715 outsourced employees,
c) modify the existing remuneration system to a performance-related remuneration system (approx. PLN 5.000 of fixed remuneration plus variable remuneration depending on financial results),
d) bear the previously planned - due to division of assets - expenditures on ventilation system.

The basis for filing the Asset purchase offer are opinions and reports prepared by the Company's advisors that define the above minimum requirements for project profitability, including estimated expenditures of PLN 253 million to be spent in the years 2016-2018 and target annual output of approx. 1.5 million tons starting from the year 2017.
In the opinion of the Company's Management Board only meeting the above conditions may guarantee profitability of the project.

Purchase of some assets of the Brzeszcze mine by the SPV should take place provided that the Supervisory Board of TAURON Polska Energia S.A. gives consent to acquire shares in increased share capital.

Article 56 section 5 of the Act on Public Offering - update of information

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