Aktuální report č. 58 / 2012

Court’s decision to declare the bankruptcy of PNI Sp.z.o.o. open to composition agreements

Having regard to Current Report No. 48/2012 of 24th August 2012, the Management Board of Budimex S.A. hereby announces that today it was informed that on 13th September 2012 the District Court for Warszawa Praga-Północ in Warsaw, 9th Commercial Department for Bankruptcy and Reorganization, endorsed the application filed by the Management Board of the applicant and issued a decision to declare the bankruptcy open to composition agreements of Przedsiębiorstwo Napraw Infrastruktury Sp. z o.o. with its registered office in Warsaw (a company wholly owned by Budimex S.A.).

The decision to declare bankruptcy is to become final within a week from it being served on PNI Sp. z o.o. unless an appeal is made within this period of time.

In accordance with the application, the court decided to retain the Management Board of PNI Sp. z o.o. as well as appointing an official receiver, the Judge of the District Court, Sławomir Bezak, and a court supervisor, Krzysztof Leśniewski.

In the application for bankruptcy open to composition agreements the Management Board of PNI Sp. z o.o. suggested that seven groups of creditors be defined, i.e.:

• Group I: small creditors with liabilities up to PLN 20,000.00 (inclusive), including creditors covered by composition agreements with their consent;
• Group II: small creditors with liabilities from PLN 20,000.01 to PLN 100,000.00 (both limits inclusive);
• Group III: medium creditors with liabilities from PLN 100,000.01 to PLN 1,000,000.00 (both limits inclusive);
• Group IV: large creditors with liabilities over PLN 1,000,000.01 (inclusive), except for creditors from Groups V, VI and VII;
• Group V: a creditor being a Company shareholder – Budimex S.A. with its registered office in Warsaw;
• Group VI: a creditor entitled to non-monetary liabilities – PKP PLK S.A. with its registered office in Warsaw;
• Group VII: creditors participating in the Voluntary Redundancy Program (PDO) covered by composition agreements with their consent.

At the same time, within the scope of these composition agreements, the Management Board of PNI Sp. z o.o. suggested reducing debt in relation to: (i) trade liabilities, (ii) liabilities from prepayments obtained, and (iii) employee liabilities in the Voluntary Redundancy Program (PDO) under the following terms and conditions:

• Group I: repayment of 100% of liabilities (no reduction),
• Group II: repayment of 90% of liabilities (reduction by 10%),
• Groups III and VII: repayment of 80% of liabilities (reduction by 20%),
• Group IV: repayment of 70% of liabilities (reduction by 30%),
• Group V: repayment of 60% of liabilities (reduction by 40%).
• The non-monetary liabilities of Group VI would be subject to restructuring, which would involve the transformation (change) of the legal relationships between PNI Sp. z o.o. and a Group VI creditor, i.e. PKP PLK S.A., resulting from four agreements of key importance to PNI Sp. z o.o. However, due to the fact that these agreements are performed for this creditor in a consortium, the above-mentioned transformation also requires approval of the consortium partners.

The Management Board of PNI Sp. z o.o. is able to pay (i) employee liabilities not covered by Group VII, (ii) public law liabilities, (iii) liabilities for special funds, and (iv) any other liabilities in full, i.e. without reduction. Liabilities from leasing agreements for machines and transport means will be paid by the Management Board of the company pursuant to the provisions of these agreements.

In relation to all debt the Management Board of PNI Sp. z o.o. suggests redemption of liabilities from interest accrued on the principal amount.

The company suggests repayment of its liabilities open to composition agreements in accordance with the reduction levels presented above, in 8 equal quarterly instalments, payable at the end of each period, beginning from the quarter following the date when the composition agreements were approved (no withdrawal period in the repayment of liabilities). According to forecasts of the Management Board of PNI Sp. z o.o., payment of the last instalment of liabilities covered by composition agreements would be made by 31st March 2015.