Conclusion of the Placement Agreement for the purpose of the non-document offering by its main shareholder, Lisala sp. z o.o., of up to 136,187,891 existing shares in Echo Investment S.A.

Not for release, publication or distribution directly or indirectly, in or into the United States of America, Australia, Canada or Japan or in any other jurisdiction where to do so would be restricted or prohibited by law.

Further to current reports No. 33/2017 dated 26 September 2017 and 38/2017 dated 4 October 2017, Echo Investment S.A. (the “Company” or “Echo”) hereby announces that on 17 October 2017 the Company and its main shareholder – Lisala sp. z o.o. (the “Selling Shareholder”) entered into the Share Offering and Placement Agreement with Kempen & Co N.V., Pekao Investment Banking S.A. and Wood & Company Financial Services, a.s. Spółka Akcyjna, Oddział w Polsce (the “Global Coordinators”) (the “Placement Agreement”).

The Placement Agreement has been entered into for the purpose of the offering by the Selling Shareholder of up to 136,187,891 existing ordinary shares of the Company (as decreased by the number of the shares to be sold by the Selling Shareholder in connection with the Offering to the following members of the Management Board: Mr Nicklas Lindberg (with a total sale price of such shares not exceeding EUR 500,000 or its Polish zloty equivalent) and Mr Maciej Drozd (with a total sale price of such shares not exceeding EUR 200,000 or its Polish zloty equivalent), in both cases at the price equal to the sale price per one share in the offering) (the “Sale Shares”). The Sale Shares will be offered and sold (a) to institutional investors outside the United States of America in reliance on Regulation S (“Regulation S”) under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), including, without limitation, by way of a public offering in Poland directed to professional clients within the meaning of the Act of 29 July 2005 on Trading in Financial Instruments or to investors, each of whom acquires securities with a value of at least EUR 100,000, such value being calculated at the selling price of such securities on the pricing date, for which reason the requirement to produce, approve and publish a prospectus in Poland will not apply, in accordance with Article 7.4.1 and/or 7.4.2 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organized Trading, and on Public Companies; and (b) in the United States of America, to a limited number of persons reasonably believed to be “qualified institutional buyers” as defined in Rule 144A under the U.S. Securities Act under an exemption from registration under the U.S. Securities Act. (the “Offering”).

Pursuant to the Placement Agreement the Global Coordinators shall place the Sale Shares on a best efforts basis. The Placement Agreement does not impose any underwriting commitment on the Global Coordinators.

The final number of the Sale Shares to be sold by the Selling Shareholder in the Offering (i.e., any number of the Sale Shares up to 136,187,891 decreased by the number of the shares to be sold to members of the Management Board of the Company referred to above, as determined following the bookbuilding process among investors referred to above) and the sale price per one Sale Share will be determined in the pricing supplement to the Placement Agreement, if and when executed by the Selling Shareholder and the Global Coordinators on the terms and conditions set forth in the Placement Agreement (the “Pricing Supplement”).

The Placement Agreement contains certain conditions to the obligation of the Global Coordinators customary for transactions of this nature, such as (a) no changes or events, as set forth in detail in the Placement Agreement, which could result in any adverse change to the Company, its business or to the Offering itself, (b) the Company and the Selling Shareholder having confirmed their representations and warranties contained in the Placement Agreement on the dates set forth in such agreement; (c) delivery on the dates set forth in such agreement of legal opinions by legal counsels to the Company, the Selling Shareholder and the Global Coordinators in the form and substance agreed with the Global Coordinators; and (d) the Company and the Selling Shareholder having performed the obligations set out in the Placement Agreement.

In the Placement Agreement, the Selling Shareholder and the Company agreed to indemnify and hold harmless, on the terms and conditions set forth in the Placement Agreement, the Global Coordinators and other specified persons against certain claims, obligations or costs which may be sought or incurred by the Global Coordinators or other specified persons in connection with the Placement Agreement (the indemnification clause).

The Placement Agreement contains standard covenants by the Global Coordinators with respect to the territorial range of undertaken placement activities and a commitment to undertake placement activities only towards particular categories of investors, in each case in compliance with the laws of the jurisdiction where such activities are to be conducted.
The Placement Agreement provides that the Company and the Selling Shareholder are subject to lock-up restrictions with respect to the transfer of the Sale Shares and share issue.

From the date of the execution of the Pricing Supplement (provided however that the Pricing Supplement is executed on the terms and conditions set forth in this Agreement) until the lapse of 180 days from the date of the settlement of the purchase transactions under the Offering (the “Settlement Date”), Company agrees that without the prior written consent of the Global Coordinators (such consent not to be unreasonably withheld or delayed) it shall not (i) issue, offer, lend, mortgage, assign, charge, pledge, sell, contract to sell or issue, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of or announce any offering or issuance of any shares or any interest in the shares or any securities convertible into or exchangeable for or substantially similar to the shares or any interest in the shares; (ii) enter into any swap or other agreement or transaction that transfers, in whole or in part, any of the economic consequences of ownership of the shares, whether any such swap or other transaction is to be settled by the delivery of the shares or such other securities, in cash or otherwise.

From the execution of the Pricing Supplement and until the lapse of 180 days from the Settlement Date the Selling Shareholder will not offer, sell or otherwise dispose of (or announce an intention of doing so) any interest in any ordinary shares of the Company remaining in its possession (the “Remaining Shares”) or offer, issue, sell or otherwise dispose of (or announce any intention of doing so) any securities convertible into or exchangeable or carrying rights to acquire such Remaining Shares, or enter into any derivative transaction that has the economic effect of such sale, transfer or disposal, whether settled in cash or otherwise, without the prior written consent of the Global Coordinators (such consent not to be unreasonably withheld or delayed), except for: (i) the sale of the Remaining Shares in any tender offer (takeover offer) announced for the shares in the Company and addressed to all the Company"s shareholders; (ii) the sale of the Remaining Shares (a) with the sale price per one such Remaining Share to be equal to the sale price of one Sale Share in the Offering, and (b) to the following members of the Management Board of the Company: Mr Nicklas Lindberg (with a total sale price of such Remaining Shares not exceeding EUR 500,000 or its Polish zloty equivalent) and Mr Maciej Drozd (with a total sale price of such Remaining Shares not exceeding EUR 200,000 or its Polish zloty equivalent), simultaneously with the execution of the Offering, not later, however, than three business days after the Settlement Date, and provided that within one (1) day following the acquisition of such Remaining Shares the Selling Shareholder shall deliver to the Global Coordinators duly executed lock-up letter of each such Member of the Management Board of the Company in which each Member of the Management Board will assume the corresponding lock-up obligation with respect to such shares for a period of 360 days following the date of the acquisition of such shares from the Selling Shareholder (subject to certain customary exemptions) and (iii) the sale, transfer or other disposal of the Remaining Shares, including through a merger or other form of economic integration, for the benefit of an entity which is an affiliate of the Selling Shareholder (provided that such affiliate also makes a similar commitment not to sell the Remaining Shares for the period remaining until the expiration of such Selling Shareholder's obligation).

The Placement Agreement is governed by English law.

This material is not a promotional material in the meaning of article 53 of the Polish Act on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organized Trading and on Public Companies dated 29 July 2005, as amended.
This material or any part hereof is not intended for distribution, whether directly or indirectly, within the territory of or in the United States of America or other jurisdictions where such distribution, publication or use may be subject to restrictions or may be prohibited by law. The securities referred to in this material have not been and will not be registered under the U.S. Securities Act, and may only be offered or sold within the United States under an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act.
This material does not contain or constitute or form part of any offer or invitation, or any solicitation of an offer, for securities, and under no circumstances shall form the basis for a decision to invest or not in the securities of the Company.

Legal basis: Art 17 section 1 MAR – inside information.