Signing of a non-binding term sheet with P4 Sp. z o.o. regarding the UMTS Transmission Solutions Delivery Frame Agreement (17/2009)
The management board of Netia S.A. (“Netia”) informs that Netia and P4 Sp. z o. o. with its registered seat in Warsaw (“P4”) concluded on March 3, 2009 a non-binding term sheet in which they agreed to negotiate in good faith the terms of the following agreements:
(i) an option agreement according to which Netia will grant P4 an option to purchase part of the radio transmission equipment currently used by Netia to provide services to P4 under the UMTS Transmission Solutions Delivery Frame Agreement entered into between Netia and P4 on 3 July 2006 (the “UMTS Agreement”). The term sheet provides that the above option should cover the purchase by P4 of the radio transmission equipment in 1944 sites, constituting approximately 90% of all sites used by Netia for rendering its transmission service to P4. In addition, the term sheet stipulates that the said option may be executed solely through the purchase of all the above referred equipment, on one of the following dates as presented below:
- Execution date: January 1, 2010 – total purchase price: 65,755,800 PLN
- Execution date: January 1, 2011 – total purchase price: 44,789,760 PLN
- Execution date: January 1, 2012 – total purchase price: 37,908,000 PLN
(ii) an annex to the UMTS Agreement; the term sheet provides that:
- the UMTS Agreement shall be concluded for an unspecified term and the termination periods for the circuits subject to the call option will be extended from 12 months to 24 months;
- P4 has the right to assign the UMTS Agreement to its subsidiary 3GNS Spółka z ograniczoną odpowiedzialnoscią sp. k.;
- new unit prices for core network transmission will be applicable in the event that P4 chooses to exercise its call option; such core transmission circuits will be subject to 24 month termination notice with the exception of a 15% allowance for reconfiguration purposes.
For details regarding the UMTS Agreement, see current report No. 58/2006 dated 3 July 2006;
Netia does not currently expect that execution of legally binding agreements in line with this term sheet to have a material impact on the Company’s guidance for 2009 or for the medium term (see Netia’s press releases No. 8/2009 and 58/2008).
Legal basis: Art. 56 sec. 1 clause 1 of the Act on Public Offerings