27/2010 - Information on the conclusion of a significant contract

The Management Board of Trakcja Polska S.A. (the "Company") hereby announces that, on 30 August 2010, the Company, in connection with the performance of a contract for the task of:

 

The performance of construction works for the comprehensive modernisation of the stations and routes in the area of LCS Działdowo, within the framework of the E&I OP 7.1-41 project:

“Modernisation of the E65/C-E65 railway line, Warsaw – Gdynia section – area of LCS Działdowo” (”Contract”)

 

the conclusion of which the Company announced in current report no. 9/2010 of 31 May 2010, concluded Agreement No. K-1103/2010 with Trakcja Polska’s Consortium Partner, Przedsiębiorstwo Napraw i Utrzymania Infrastruktury Kolejowej sp. z o.o. with its registered office in Kraków (30-556), ul. Prokocimska 4, (hereinafter: “Partner”), for the performance of some of the sectoral works under the Contract, including track works, drainage works, road works and civil engineering works (“Agreement”).

 

Net Agreement value:PLN 47,956,031.54 (forty-seven million nine hundred and fifty-six thousand and thirty-one zlotys 54/100)

 

 

Payment terms:

 

The Partner shall issue VAT invoices for works completed and accepted once a month for a net amount arising from the acceptance protocol of the completed elements of the works.

Advance:

 

The Partner shall receive an advance of 10% of the net fee arising from the Agreement (Net Agreement Value) plus VAT no later than 30 days before the start of the works.

The condition for the payment of the advance is the previous receipt of an advance arising form the Contract by the Company from the contracting authority – PKP Polskie Linie Kolejowe S.A. (hereinafter: “PKP PLK”) and the submission by the Partner of a guarantee for the refund of the advance.

The wording of the guarantee which the Partner is obliged to present has been previously agreed with the Company.

Contractual penalties:

 

1. The Company is entitled to charge a contractual penalty of 0.05% of the gross Agreement value for every day of delay if the Partner exceeds the deadlines for the performance of the works specified in the schedule approved by the Parties, if PKP PLK charges such penalties to the Company. Notwithstanding the above, if the delay exceeds 15 (fifteen) days, the Company is entitled to withdraw from the Agreement, notifying the Partner in writing without the need to set an additional deadline and without incurring any financial or legal consequences to the Partner’s benefit.
2. The Company is entitled to charge a contractual penalty of 0.05% of the gross Agreement value for every commenced day of delay in starting to fix defects or in fixing defects if the Partner exceeds the deadlines for starting to fix defects / faults / shortcomings or for fixing them during the guarantee period or the period for their rectification specified in the Agreement if PKP PLK charges such penalties to the Company. If the delay exceeds 3 (three) days, the Company is entitled to contract for the elimination of the defects with a third party at the Partner’s expense. The Partner shall refund the costs of fixing the defect within 7 (seven) days of the date of delivery to the Partner of documents confirming that the Company has incurred the costs of a third party fixing the defects.
3. The Partner shall pay the Company a contractual penalty of 10% of the gross Agreement value for either party withdrawing from the Agreement through the Partner’s fault.
4. The Company shall pay the Partner a contractual penalty of 10% of the gross Agreement value for either party withdrawing from the Agreement through the Company’s fault.
5. The contractual penalties provided for above are payable to the bank account specified by the Company within 3 (three) days of the date of the demand by the Company.
6. The maximum amount of default penalties may not exceed 10 % of the gross Agreement value.
7. The Company is entitled to claim compensation in excess of the contractual penalties referred to above on general terms if the damage suffered by the Company exceeds the value of the contractual penalties reserved in the Agreement to its favour.

The Agreement has been acknowledged a significant agreement because its value exceeds 10% of the value of Trakcja Polska S.A.’s equity.

 

Legal grounds:§ 5(1)(3) of the Regulation of the Minister of Finance of 19 February 2009 on current and regular information published by issuers of securities and the conditions for accepting information required by the provisions of the law of a state which is not a Member State as being equivalent.

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