Conclusion of annexes and issue of bonds concerning West Link, Browary Warszawskie and Beethovena projects

The Management Board of Echo Investment S.A. (the "Company") informs that on 12 June 2017 the Company together with its controlled entities, i.e. "Grupa Echo" Sp. z o.o. and FORUM 60 Fundusz Inwestycyjny Zamknięty  as the sellers, (collectively, the "Sellers”), and the entity controlled by Griffin Premium RE. N.V. ("Griffin Premium"), i.e. IB 14 Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych, acting as the buyer, (the “Buyer”), signed annex no. 2 ("Annex No. 2 to the Preliminary Share Sale Agreement") to the preliminary share sale agreement dated 9 March 2017, concerning the sale of 100% shares in the companies: Projekt Echo - 114 Sp. z o.o. ("Projekt Echo") and Elissea Investments Sp. z o.o. ("Elissea", and together with Projekt Echo, “Project Companies"), being, respectively, the general partner and the limited partner of West Gate II - Projekt Echo - 114 Spółka z ograniczoną odpowiedzialnością sp.k. (“West Gate II”) (the "Preliminary Share Sale Agreement"). West Gate II is the owner of the property in Wrocław, where the construction of an office and service building under the name of "West Link" (the “Building”) is carried out. The Company announced the conclusion of the Preliminary Share Sale Agreement in its current report no. 5/2017 from 14 March 2017 (the "Initial Report"). Based on Annex No. 2 to the Preliminary Share Sale Agreement, inter alia, the Sellers granted to the Buyer powers of attorney authorising the Buyer to conclude the final agreement for the acquisition of 100% shares in the Project Companies (the "Final Agreement") in execution of the Preliminary Share Sale Agreement. Additionally, the Buyer received proposal to acquire bonds with a total nominal value and an issue price of EUR 18,000,000, issued under private placement by the entity controlled by the Company (the "West Link Bonds"), and the proposal was subsequently accepted by the Buyer. The maturity date of the West Link Bonds is 31 December 2018, however, the earlier redemption of West Link Bonds is possible if, inter alia, the Final Agreement is concluded earlier. West Link Bonds will be redeemed by means of payment of the amount equal to the nominal value of each bond plus accrued interest. The West Link Bonds bear interest at a fixed interest rate in the amount and under the terms stipulated in the West Link Bonds issue terms. The West Link Bonds are unsecured bonds. The nominal value of the West Link Bonds will be, inter alia, offset with the sale price of 100% shares in the Project Companies. The parties also agreed that the initial sale price of 100% shares in the Project Companies would total EUR 18,000,000 (taking into account the formula regarding calculation of the price presented in sec. 1.6 of the Initial Report, i.e. the price will be established as follows (i) the quotient of NOI (i.e. the difference between the operating income and undeductable operating costs) of the Building and 6.873%, which amounted to EUR 36,060,000 on the day of conclusion of the Preliminary Share Sale Agreement, (ii) plus the estimated working capital and cash amount and (iii) decreased by the debt amount of the Project Companies and West Gate II, where it is estimated that the debt amount will amount approx. EUR 18,000,000). The payment of the price for the shares in the Project Companies will be made through remittances (przekaz) between the Sellers and the Buyer and by offsetting the receivables of one of the Sellers for the payment of the price for the shares in the Project Companies against the Buyer's receivables for the redemption of the West Link Bonds. In exchange for subscription of the West Link Bonds and for the payment of EUR 18,000,000 by the Buyer to one of the Sellers, the Sellers granted to the Buyer irrevocable powers of attorney authorising the Buyer to conclude the Final Agreement in execution of the Preliminary Share Agreement (the “Powers of Attorney"). The Buyer will be entitled to exercise the Powers of Attorney in the event of: (i) failure, despite a request, to conclude the Final Agreement; and  (ii) occurrence of one of the events of default listed in the West Link Bonds documentation. In addition, the Management Board of the Company informs that on 12 June 2017, the Company, Griffin Premium and Griffin Premium's subsidiary, GPRE Management sp. z o.o. (“GPRE Management”), signed annex no. 2 (the "Annex No. 2 to the ROFO Agreement") to the agreement for ROFO projects concluded on 9 March 2017, concerning the investment of 25% of the capital already invested, and the future capital required to complete the construction and to finalise office projects in Warsaw, i.e. Beethovena project (phase I and II) and Browary Warszawskie project (phase J), by the Company's subsidiaries (the "ROFO Agreement"), whose conclusion was reported by the Company in the Initial Report. At the same time, and in connection with the conclusion of Annex No. 2 to the ROFO Agreement, GPRE Management was presented proposal to acquire bonds of several series with a total nominal value and an issue price of EUR 6,400,000, issued under private placement by the Company"s subsidiaries (the “ROFO Bonds"), and the proposal was subsequently accepted by the GPRE Management. The maturity date of the ROFO Bonds of all series is 12 June 2032, however, the earlier redemption of relevant series of the ROFO Bonds is possible if, inter alia, the ROFO transaction regarding given phase of Browary Warszawskie project or Beethovena project is closed earlier than initially expected. ROFO Bonds will be redeemed by means of payment of the amount equal to the nominal value of each bond plus accrued interest. The ROFO Bonds bear interest at a fixed interest rate in the amount and under the terms stipulated in the ROFO Bonds issue terms. The ROFO Bonds are unsecured bonds. Legal basis: Article 17 paragraph 1 of the MAR - inside information