Loan agreement of Issuer’s subsidiary

The Management Board of Echo Investment S.A. (hereinafter referred to as "the Issuer") reports that on the 10th of October 2017 Issuer"s subsidiary: 1/ GALERIA LIBERO - PROJEKT ECHO - 120 SPÓŁKA Z OGRANICZONĄ ODPOWIEDZIALNOŚCIĄ SPÓŁKA KOMANDYTOWA with its seat in Kielce, Al. Solidarności 36, 25-323 Kielce, registered at the District Court in Kielce, 10th Commercial Division, under the KRS number 0000643454, (hereinafter referred to as "the Borrower",  "the Company") signed a contract concerning an investment loan, a construction loan and a VAT loan (hereinafter referred to as "the Contract") with the banks: 1/ Bank Zachodni WBK Spółka Akcyjna with its seat in Wroclaw, ul. Rynek 9/11, 50-950 Wrocław, registered in the District Court (the National Court Register) operated by the District Court for Wrocław-Fabryczna , 6th Commercial Division, under the KRS number 0000008723, 2/ Bank BGŻ BNP Paribas Spółka Akcyjna with its seat in Warsaw, ul. Kasprzaka 10/16, 01-211 Warsaw, registered at the District Court (the National Court Register) operated by the District Court for the capital city of Warsaw, 12th Commercial Division of the National Court Register, under the KRS number 0000011571 (hereinafter referred to as "the Lenders" and "the Banks") The funds acquired on the basis of the Contract, amounting EUR 67,566,000 (say: sixty seven million five hundred sixty six thousand euro) and PLN 12 mln (say: twelve million zloty), will be used by the Borrower mostly for: i. financing and refinancing the expenditure on the construction of the Libero shopping centre in Katowice;
ii. repayment of the Borrower"s intra-group debt and the financing of the Borrower"s working capital. The amounts of the loan bear interest: the Construction Loan and the Investment Loan are based on the variable EURIBOR percentage rate, the VAT Loan is based on the variable WIBOR percentage rate plus Banks" margins. The repayment dates of the loans are as follows: 1/ with reference to the construction loan – within 42 months from the date of Contract signing;
2/ with reference to the VAT loan – the earlier date: within 45 months from the date of Contract signing or within 39 months from the first release of the construction loan;
3/with reference to the investment loan – the final repayment day is the earlier date: no later than within 5 years from the Loan Conversion Date or 10 April 2026. The main collaterals provided by the Borrower in order to guarantee the repayment of the Loan and any amounts due to the Banks are: 1/ the highest priority real estate mortgage on the Properties of up to 150% of the commitment concerning the investment loan and the construction loan in favour of the Lender;
2/ the second priority real estate mortgage on the Properties of up to 150% of the commitment concerning VAT loan value in favour of the Lender;
3/ Borrower"s statements of execution;
4/ Power of Attorney to Borrowers" Bank Accounts;
5/ Registered and Financial Pledge Agreements on shares, stocks, rights and accounts, based on which registered and financial pledges of the highest priority will be established to the benefit of the Lenders as well as financial pledges on all the shares in the Borrowers share capital, up to 150% of the secured obligations, in the form and contents which are satisfactory to the Lenders;
6/ Transfer Agreement in order to secure receivables and rights of the Lenders resulting from: all the Lease Agreements, Insurance Agreements, Construction Work Agreements, performance bonds concerning Construction Work Agreements, Project Management Agreement and other Project Documents;
7/ a financial support provided by the Guarantor (i.e. the Issuer) regarding a capital injection of up to EUR 13,245,000 pursuant to the principles stipulated in the Cost Overrun Guarantee. The agreement provides for an obligation to meet the standard in this type of transaction conditions precedent to the payment of the above loans and to meet the consecutive conditions after the release of the abovementioned loans, which are also standard for such transactions. Legal basis: Art. 17 section 1 MAR – confidential information