The Management Board of Mostostal Warszawa S.A. informs that today the company signed with Medical Investment Trust Sp. z o.o., a contract for “the execution of works under the general contractor for the investment involving the construction of the hotel building with apartments at the intersection of Mestwina and Międzymorze in Jurata with an underground garage with land development and technical infrastructure on the plot with registration number 326 of 0003 precincts Jastarnia".

The parties agreed the deadline for the completion of contract till 6 February 2018. 
The value of the contract amounts to PLN 14.50 million net.

Payment deadline: 30 days from the date of filing the invoice.

Guarantee periods: 60 months for the quality guarantee and guarantee for physical defects in the object of the contract.

The security for the proper performance of subject of the Agreement and claims arising from it is unconditional insurance performance guarantee of 10% of net salary. In the guarantee and warranty period the Contractor shall provide an unconditional and payable on each request bank or insurance guarantee removal of faults and defects after the final acceptance of the subject of the Agreement in the amount of 5% of the net salary.

The Management Board of Mostostal Warszawa S.A. (the “Company”) would like to confirm that today the Company has received the administrative decision of the Polish Financial Supervision Authority [KNF] (the “PFSA”) of 26 May 2017, by which the PFSA imposed a monetary sanction of PLN 300,000 on the Company.

In its decision, the PFSA stated that:

1. in connection with the preparation of the consolidated annual report for 2011, the Company, in the administrative body’s opinion, improperly performed the obligation referred to in Article 56(1)(2)(a) of the Public Offering Act, in conjunction with § 3(1) and (3) in conjunction with § 82(1)(3), § 82(2) and § 92(1)(3)(b) of the Regulation of the Minister of Finance of 19 February 2009 on the current and periodic information provided by security issuers and on the conditions for recognizing information required by the law of a non-member state as equivalent information (Dz.U. of 2009, No 33, item 259, as amended, hereinafter the “Regulation”) in conjunction with paragraph 14 of the International Accounting Standard 11 “Construction Contracts” (hereinafter “IAS 11”), adopted by Commission Regulation (EC) No 1126/2008 of 3 November 2008 adopting certain international accounting standards in accordance with Regulation No 1606/2002 of the European Parliament and of the Council (OJ L 320 of 29 November 2008, p. 1-481, as amended) (hereinafter “Commission Regulation (EC) No 1126/2008”) by including in the revenue from the following contracts: „Design and construction of motorway A2 Stryków – Konotopa at section B from km 394+500 to km 411+465.80”, „Construction of motorway A4 Tarnów – Rzeszów at the section from junction Rzeszów Centralny to junction Rzeszów Wschód km approx. 574+300 to approx. 581+250”, "Upgrade of road S – 7 into two-lane road at the Kielce ring road section, Kielce (DK 73 junction Wiśniówka) – Chęciny (junction Chęciny)”, the amounts of additional revenue arising from claims against customers, which in the administrative body’s opinion did not qualify for recognition in the consolidated financial statements for the financial year 2011,
2. in connection with the preparation of the annual report for 2011, the Company, in the administrative body’s opinion, improperly performed the obligation referred to in Article 56(1)(2)(a) of the Public Offering Act, in conjunction with § 3(1) and 3 in conjunction with § 82(1)(3) and § 91(1)(3)(b) of the Regulation in conjunction with paragraph 14 IAS 11, by including in the revenue from the following contracts: „Design and construction of motorway A2 Stryków – Konotopa at section B from km 394+500 to km 411+465.80”, „Construction of motorway A4 Tarnów – Rzeszów at the section from junction Rzeszów Centralny to junction Rzeszów Wschód km approx. 574+300 to approx. 581+250”, "Upgrade of road S – 7 into two-lane road at the Kielce ring road section, Kielce (DK 73 junction Wiśniówka) – Chęciny (junction Chęciny)”, the amounts of additional revenue arising from claims against customers, which in the administrative body’s opinion did not qualify for recognition in the financial statements for the financial year 2011,
3. in connection with the preparation of the consolidated annual report for 2012, the Company, in the administrative body’s opinion, improperly performed the obligation referred to in Article 56(1)(2)(b) of the Public Offering Act, in conjunction with § 3(1) and 3 in conjunction with § 82(1)(3), § 82(2) and § 92(1)(3)(b) of the Regulation in conjunction with paragraph 14 IAS 11, by including in revenues from the following contracts: „Design and construction of motorway A2 Stryków – Konotopa at section B from km 394+500 to km 411+465.80”, „Construction of motorway A4 Tarnów – Rzeszów at the section from junction Rzeszów Centralny to junction Rzeszów Wschód km approx. 574+300 to approx. 581+250”, „Upgrade of the existing road S-7 into a two-lane express way at the section from junction Kielce Północ to junction Chęciny”, „Construction of a bridge over the River Odra including with flyovers at section from km 18+174 to 19+960 along Wrocław A8 Motorway Ring Road”, „Conversion of national road 2 at section Zakręt – Mińsk Mazowiecki from km 495 – 880 to km 516+550”, "Upgrade of national road 8 into express way at section – Mazowieckie Province boundary – Radziejowice from km 408+753 to km 418+400 and 418+400 to 420+100” the amounts of additional revenue arising from claims against customers, which in the administrative body’s opinion did not qualify for recognition in the consolidated financial statements for the financial year 2012,
4. in connection with the preparation of the annual report for 2012, the Company, in the administrative body’s opinion, improperly performed the obligation referred to in Article 56(1)(2)(a) of the Public Offering Act, in conjunction with § 3(1) and 3 in conjunction with § 82(1)(3) and § 91(1)(3)(b) of the Regulation in conjunction with paragraph 14 IAS 11, by including in revenues from the following contracts: „Design and construction of motorway A2 Stryków – Konotopa at section B from km 394+500 to km 411+465.80”, „Construction of motorway A4 Tarnów – Rzeszów at the section from junction Rzeszów Centralny to junction Rzeszów Wschód km approx. 574+300 to approx. 581+250”, „Upgrade of the existing road S-7 into a two-lane express way at the section from junction Kielce Północ to junction Chęciny”, „Construction of a bridge over the River Odra including with flyovers at section from km 18+174 to 19+960 along Wrocław A8 Motorway Ring Road”, „Conversion of national road 2 at section Zakręt – Mińsk Mazowiecki from km 495 – 880 to km 516+550”, "Upgrade of national road 8 into express way at section – Mazowieckie Province boundary – Radziejowice from km 408+753 to km 418+400 and 418+400 to 420+100” the amounts of additional revenue arising from claims against customers, which in the administrative body’s opinion did not qualify for recognition in the financial statements for the financial year 2012.

The Company would like to confirm that it has actively participated in the proceedings and, following the assessment of the argumentation contained in the administrative decision, it is considering the exercising of the right to apply to the PFSA for reconsideration of the case.