Current report no 50 / 2019

“Construction of a pipeline connecting the transmission systems of the Republic of Poland and the Slovak Republic, including the infrastructure necessary for its operation – the Strachocina pipeline – Polish border” – signature of a contract

The Management Board of Budimex SA announces that on 19 July 2019 a contract for the “Construction of a pipeline connecting the transmission systems of the Republic of Poland and the Slovak Republic, including the infrastructure necessary for its operation – the Strachocina pipeline – Polish border” was signed between the consortium comprising Budimex S.A. (leader: 94.46% share in the consortium) and Mostostal Kraków S.A. (partner: 5.54% share in the consortium)) and Gas Transmission Operator GAZ-SYSTEM S.A. (Ordering Party).

The information that our bid had been selected as the most advantageous one was communicated by us in current report No 27/2019 of 24 April 2019.

Contract value: PLN 521,479,055.00 net

In accordance with the provisions of the contract, the Ordering Party may lower the value of the contract to the minimum of PLN 347,580,765.00 net on the basis of its unilateral decision. The final value of the contract will be determined by the Ordering Party no later than by 31 December 2019.

Works commencement date: from the Contract date

Works completion date: 31 months from the Contract date

Guarantee period: 36 months

Statutory warranty period: 36 months

Advance payment: PLN 60,000,000.00

Payment terms: 30 days from the day of delivery of a correct VAT invoice to the Ordering Party by the Contractor

Bank performance bond: 10% of the total gross remuneration

Maximum amount of contractual penalty paid by the Contractor: 20% of the net remuneration

Contractual penalties paid by the Contractor do not deviate from market standards

The Ordering Party has the right to claim supplementary compensation exceeding the amount of contractual penalties stipulated in the contract, in accordance with the general principles of the Civil Code.

Other terms and conditions of the contract do not differ from the market standards.

The value of the contract exceeds the threshold of PLN 147,743 thousand net.