WARSAW, Poland – July 3, 2006 – Netia SA (“Netia”, “Company”) (WSE: NET), Poland’s largest alternative provider of fixed-line telecommunications services, today announced that Netia and P4 Sp. z o. o. with its registered seat in Warsaw (“P4”) concluded a framework agreement on delivering by Netia to P4 the transmission solutions for P4’s UMTS network (“Agreement”). The Agreement was concluded for the five-year term following which the Agreement shall be automatically extended for an unlimited period of time, unless the parties to the Agreement decide otherwise. The Agreement may be terminated prior to the term indicated above in case of violation of its provisions. The remuneration of Netia for providing services referred to in the Agreement shall be calculated based on the parameters and the number of circuits delivered to P4. Expected revenues for Netia under the Agreement within the five year period may reach PLN 280 million, which exceeds 10% of the current value of Netia’s equity and therefore represents the criterion for classifying the Agreement as significant.
The liability of the parties with respect to the Agreement is limited to the actual damage amount, unless the damage is caused by the intentional fraud or gross negligence. Liability of Netia for the interruptions in signal transmission or for the deterioration of quality of services provided is limited to the level of the fee for the circuits leased, unless those irregularities are caused by the intentional fraud or gross negligence of Netia. In case the parameters of services are not met, the remuneration of Netia shall be reduced.