47/2019 – Receiving information from ARP in connection with ongoing negotiations regarding the possibility of ARP investing in the Company

In connection with the current report of Trakcja PRKiI S.A. (‘Company’) No. 46 of 27 September 2019, the Management Board of the Company informs that in connection with the negotiations conducted since 14 March 2019 with the Agencją Rozwoju Przemysłu S.A. (‘ARP’) regarding the potential for ARP to participate in On September 27, 2019, the Company’s Management Board considered by the Company, the Management Board of the Company received from ARP a letter according to which ARP confirmed that, provided that the Company concluded the documentation regulating the conditions of refinancing the Company’s debt with financial institutions (Long-term Financing Documentation) and The Company specified in the Long-term Financing Documentation terms of payment of funds, as well as the adoption by the General Meeting of the Company of resolutions on increasing the Company’s share capital and amending the Company’s statute (Resolution), in the wording acceptable to ARP, based on which, among others:

• the share capital of the Company will be increased from PLN 41,119,638.40 by an amount not less than 18,635,294.40 and not more than 28,235,294.40, ie not less than PLN 59,754,932,80. and not higher than PLN 69,354,932.80, through the issue of 10,279,909 series B ordinary bearer shares with a nominal value of PLN 0.80 each (Series B Shares), and not less than 13,014,209 and not more than 25,014,209 ordinary registered series C shares, with a nominal value of PLN 0.80 each (Series C Shares), whereas Series C Shares will be eventually converted into bearer shares;
• the issue price will be equal for Series B Shares and Series C Shares, and the Company’s Management Board, subject to the prior consent of the Company’s Supervisory Board, will be authorized to determine the final terms of the offer to take up Series B Shares and Series C Shares;
• the amended Company’s Articles of Association will provide for certain rights granted to the key investor, i.e. Agencja Rozwoju Przemysłu S.A., covering, among others the right to appoint and dismiss two members of the Company’s Supervisory Board and the right to appoint and dismiss two members of the Company’s Management Board, including a member of the Management Board responsible for internal audit and a member of the Management Board responsible for key clients,

ARP will be ready to participate in the process of recapitalization of the Company by taking up shares in the increased share capital of the Company, under the conditions resulting from Resolutions and subscription documents agreed between ARP and the Company, provided that the issue price of Series B Shares and Series C Shares determined by the Company’s Management Board is not higher than PLN 1.70 (‘Writing’).

At the same time, the Company’s Management Board attaches the content of the Letter to this current report.

Legal basis: Art 17 ust. 1 MAR. 1 MAR