Execution of an agreement on periodic granting of contractual insurance guarantees

Legal basis: Article. 17(1) of the Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC

The Management Board of "Polimex-Mostostal" SA, with its registered office in Warsaw (the “Issuer”), informs that today, between the Issuer, Polimex Energetyka sp. z o.o. (with the Issuer, jointly referred to as the “Principals”) and Powszechny Zakład Ubezpieczeń SA, with its registered office in Warsaw (”PZU”PZU”) an agreement has been executed, the subject of which is to define the terms and conditions under which PZU will provide contractual insurance guarantees, within the agreed exposure limits (the “Agreement").

The total exposure limit for both Principals is PLN 98,970,000.00, with the proviso that for Polimex Energetyka sp. z o.o. the sub-limit will not exceed PLN 20,000,000.00. The exposure limit is valid for the period from 1 September 2017 to 31 August 2018, and is renewable.

Security for any potential PZU’s claims is provided in the form of Principals’ blank promissory notes and a security deposit.

PZU has the right at any time to reduce the exposure limits, if no change is made or not to provide additional guarantee, or if the economic and/or financial conditions of a given Principal has deteriorated, which, in the PZU’s assessment may result in the loss of ability to fulfil its obligations under the Agreement.

PZU may terminate the Agreement, i.a. in the following cases: (I) improper fulfilment of the Principal’s obligations under the Agreement and/or any other agreements executed with PZU, (ii) initiation of a court or administrative proceedings against either of the Principals, which, in PZU’s assessment will adversely affect the Principals’ ability of repayment of liabilities to PZU, (iii) significant deterioration, in PZU’s assessment of the economic and/or financial situation of any of the Principals.

The agreement has been executed for an indefinite period of time. If no exposure limit is set for a subsequent period of time, the agreement will be terminated on the day of expiry of any obligations of the Parties under the Agreement.