POSITION OF THE MANAGEMENT BOARD OF AUTOSTRADA WIELKOPOLSKA SA

POSITION OF THE MANAGEMENT BOARD OF AUTOSTRADA WIELKOPOLSKA SA CONCERNING THE STATE BUDGET PAYMENTS ON ACCOUNT OF COMPENSATION FOR THE TOLL FREE PASSAGE OF HEAVY VEHICLES ON THE CONCESSION SECTION OF THE A2 MOTORWAY.

In response to the press release referring to the Supreme Audit Chamber (NIK) Report on the payments from the State budget to the concessionaires on account of the compensation for the use of motorways, below please be informed as follows:

1. The government payments of compensation for the passage of heavy trucks on the tolled sections of the A2 Motorway have been made in compliance with the provisions of law  (including , without limitation, the Toll Motorways and the National Road Fund Act ) and with the Agreement executed between AWSA and the GDDKiA in 2005 (Annex 6 to the Concession Agreement) .  Therefore, there have been no undue overpayments referred to in the NIK Report and in the press.

2. The reliability and transparency of the financial model that was the basis for the calculation of the compensation rates for the vehicles holding valid vignettes was endorsed by way of the approval of the international financial institutions, including the European Investment Bank. The participants in the pertinent negotiations included, among others, the representatives of the Ministries, the GDDKiA, the advisors to the public party and the lending banks.

3. In the 2005 Agreement, AWSA undertook to provide the public party with the Verification Report by 1 July 2007. Such Report deals with the verification of the compensation rates, based on the updated traffic assumptions and the related costs and accounting for the long term bank loans repayment potential. Having incorporated the comments of the public party’s financial advisor and having made the relevant changes to the financial model, the parties endorsed the validity of the Verification Report. There were no further comments made by the deadline provided for in the 2005 Agreement.

4. The amount for the alleged return by AWSA has not been substantiated by any calculations.

5. AWSA has repeatedly been expressing our  willingness  to discuss that topic, seek financial cost savings and harmonizing those costs with the present market conditions , to hold talks on the basis of sound calculations, secure legal grounds and long-term solutions. If  approved, the terms proposed by AWSA may bring significant advantages to all parties involved, especially to the State Treasury.

6. Until the loans are repaid, all financial decisions must be approved first by the lending banks (the EIB and 16 international commercial banks) . According to the agreements executed and approved by the State Treasury , the proper financial performance of the Project is supervised by the Facility Agent on behalf of all lenders . No reputable lender would have allowed any changes in the project they finance that would involve incorrect and unreliable assumptions.

7.  As yet, the shareholders have received no distributions from the Project.  The payments made by the public party as compensation for the toll exemption of trucks holding valid vignettes have been applied solely to pay the costs of the operation, repayment of the loans and the development of the motorway under concession.