25/2017 Conclusion of the agreement for the performance of construction works by a subsidiary company

Management Board of CPD S.A. (hereinafter the Company) would like to inform that on 29 June 2017 the agreement for the performance of the construction works by the general contractor (the “Agreement”) was signed as part of the URSA-PARK investment project by and between 4/113 Gaston Investments spółka z ograniczoną odpowiedzialnością sp.k.(”4/113 Gaston”), as the Ordering Party and UNIBEP S.A.

The investment project constitutes a joint construction venture consisting in the realization jointly with Unidevelopment S.A. of the complex of multifamily buildings with commercial services and related infrastructure. The company informed in its current reports 3/2017 and 4/2017 on the conclusion of the investment agreement concerning the realization of the Investment Project.

At the same time in view of the fact that there is no need to obtain the consent of the President of the Office for Protection of Competition and Consumers for Unidevelopment S.A. to join 4/113 Gaston Investment spółka z ograniczoną odpowiedzialnością sp.k. for the purposes of realization of the Investment Project, currently the parties to the investment agreement are in the process of negotiation of formal amendments to the said investment agreement.

Subject matter of the agreement consists in the realization of the Investment Project i.e. the construction of the residential complex covering 3 residential buildings with the underground garage and development of the area. Works are realized in two stages and as part of the Agreement the realization of the I stage was commissioned covering the construction of two residential buildings with the underground garage. There will be a total of 189 apartments and 10 commercial premises and 236 parking spaces in the 7-storey high buildings realized as part of this stage.

4/133 Gaston may at any time, however not later than 2 months prior to the planned commencement of the construction works, adopt a decision on the realization of the II stage of the Investment Project by notifying UNIBEP S.A. of the same in writing.

Commencement of the realization of the I stage is scheduled for III quarter of 2017 and the completion thereof for IV quarter of 2018. And the time limit for completion of the construction works as part of the II stage was set as 16 months starting from the date of their commencement.

Remuneration for the completion of the I stage amounts to approx. 40.2 million zlotys net. And the remuneration for the realization of II stage, in the case where it is commissioned for realization by the Ordering Party, has been set at approx.. 33.4 million zlotys net.

Agreement provides for the possibility to charge UNIBEP S.A. with contractual penalties among others for delays in the realization of the Agreement as well as to withdraw from the Agreement by 14/119 Gaston under the terms and conditions specified in the Agreement and the penalties shall be charged independently. Stipulation of the contractual penalties shall not deprive 4/113 of the right to claim compensation increasing the amount of contractual penalties to the value of the actual damage under the general terms and conditions.

Other provisions of the Agreement, including in relation to the possibility of withdrawal from the agreement are in line with the standards commonly applied for these type of agreements.

 

Legal basis:

Art. 17 par. 1 MAR – Confidential Information

 

Signatures of persons representing the Company:

Elżbieta Donata Wiczkowska, President of the Management Board, 29 June 2017