Report 3/2018

15 marca 2018

Current report 3/2018 dated 15 March 2018

Conclusion of an annex to the shareholders agreement / Acquisition of shares in Domodi sp. z o.o.

Legal basis: Article 17 sec. 1 of the Market Abuse Regulation – confidential information

Content of the report:

The Management Board of Wirtualna Polska Holding S.A. ("Company" or "WPH") hereby informs that on March 15, 2018, Wirtualna Polska Media Spółka Akcyjna with its registered office in Warsaw ("WPM") - a subsidiary of WPH, concluded with three natural persons - Polish citizens and Miton Investment a.s. a company incorporated under the laws of the Czech Republic (hereinafter referred to as "Domodi Shareholders") an annex ("Annex") to the shareholders' agreement dated September 12, 2014 (as amended) ("Shareholders' Agreement") regulating the rights and obligations of shareholders of Domodi spółka z o.o. with its registered office in Wrocław at ul. Rogowska 127, 54-440 Wrocław entered into the Register of Entrepreneurs of the National Court Register under the number KRS 402177, share capital PLN 523,200 ("Domodi"). At the same time, on the basis of the Annex to the Shareholders' Agreement, the Company joined the Shareholders’ Agreements as one of the party.

By way of an Annex, the parties to the Shareholders' Agreement decided to change the conditions of the option to purchase a minority stake of Domodi shares, which originally assumed purchase of shares in two equal tranches of 24.5% each, respectively after the end of the 2017 and 2019 financial years. The amended Shareholders Agreement provides that the Company and WPM conclude an agreement of purchase of 35% shares in Domodi on the date of the amended Shareholders Agreement, on the terms described below, and the right to exercise options for the remaining 14% of shares for the next ten years, with the first option after the end of the year 2018 ("Option II").

At the same time, as a result of the implementation of Option I on March 15, 2018, the Company and Domodi Shareholders concluded with the participation of a subsidiary - WPM a share purchase agreement on the basis of which the Company acquired a total of 918 shares with a nominal value of PLN 200 each, in the share capital of Domodi ("Shares") representing approximately 35% of the share capital of Domodi and entitling to exercise about 35% of votes at the shareholders' meeting of Domodi ("Agreement") ("Transaction").

The sale price for all the purchased Shares is PLN 85,484,104.92 (in words: eighty-five million, four hundred and eighty-four thousand, one hundred and four zlotys, 92/100). The transfer of rights to Shares will take place upon payment of the Price on the terms specified in the Agreement.

Prior to the transaction, WPM had a controlling stake of 51% of shares in Domodi. As a result of the Transaction, a total of approximately 86% of Domodi shares entitling to exercise approximately 86% of votes at the Domodi shareholders' meeting are owned by the companies of the WPH Capital Group.

Before the Annex was signed, the discounted value of the Capital Group's liability for the purchase of shares estimated at PLN 59.3 million with respect to the option implemented after the end of 2017 and PLN 60.3 million with respect to the option implemented after the end of 2019.

In connection with the signed Annex, the value of the liability due to the modified option for the remaining 14% of shares in Domodi will be subject to estimation by the Management Board, with a preliminary estimate of its discounted value of approximately PLN 36 million. The difference in the discounted valuation of liabilities in the amount of approximately PLN 2 million will be recognized in the Group's result as an additional financial cost in the first quarter of 2018.

The acquisition of shares was financed from a loan granted to the Company by WPM with funds from the tranche of the Capex Loan under the loan agreement of 12 December 2017 up to PLN 500,000,000, of which the Company informed in the current report 69/2017 of 12 December 2017 .

Legal basis: Art. 17 (1) of the European Parliament and of the Council (EU) No 596/2016 of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6 / EC of the European Parliament and of the Council and Commission Directives 2003/124 / EC, 2003/125 / EC and 2004/72 / EC.

Signatures of persons representing the Company:
Jacek Świderski - President of the Management Board
Elżbieta Bujniewicz - Belka - Member of the Management Board