Current reports

Current reports

Current reports

Current report no. 29/2016

Termination of the long-term heat sales agreement

Legal basis:

Art. 56 section 1 point 2 of the Public Offering Act - Current and periodic information

Contents of the report:

Zespół Elektrowni Pątnów-Adamów-Konin S.A. („Company”) informs, that on 30 June 2016 The Company notified the Miejskie Przedsiębiorstwo Energetyki Cieplnej - Konin Sp. o.o. ("MPEC") termination of the Heat Sales Agreement no. 93/MPEC /PAK/2005 concluded on 1 January 2005 between the Company and the MPEC (the "Agreement"), the subject of which is the supply of heat from the Company for the city of Konin implemented from the date of signing the Agreement.

The Agreement expires with maintaining of 4 year termination period, effective on 30 June 2020.

The Agreement was terminated by the Company due to the fact that production of heat from currently use lignite fired source in Konin Power Plant will be no longer possible after 30 June 2020. While adjustment of currently used source would cause expenditures higher than the economic effects of the adjustment.

Value of the Agreement turnover in 2015 was close to PLN 34 m. The company still wants to remain a supplier of heat for the city of Konin, and therefore conducts analytical and formal-legal framework aimed at development of optimal new heat source, replacing the existing source of lignite, which could be the basis for the conclusion of a new contract with MPEC.

The Agreement was considered as material because the total value of benefits arising from Agreement within last 5 years exceeds 10% of the equity of the Company.

Legal basis: § 5 section 1 item 5 and § 11 of the Finance Minister’s Regulation of 19 February 2009 on the Current and Periodic Information Transmitted by Securities Issuers and the Conditions for Recognizing the Information Required by the Regulations of a Non-Member State as Equivalent.

Signatures of persons representing the company:

Adam Kłapszta – acting President of the Management Board

Adrian Kaźmierczak – Vice President of the Management Board