Conclusion by Izostal S.A. of a contract for the delivery of coated steel pipes DN 800 to OGP Gaz-System S.A.

Date  of issue: 2012-06-15
 
Legal basis: Art. 56 Clause 1 Item 2 of the Offering Act - current and periodic information.
 
SUBJECT: Conclusion by Izostal S.A. of a contract for the delivery of coated steel pipes DN 800 to OGP Gaz-System S.A.

CONTENT OF THE REPORT:
Following the current report no. 31/2012 of June 4, 2012, the Management Board of Izostal S.A. (Company, Contractor) informs that on June 15, 2012 Izostal concluded a contract with Operator Gazociągów Przesyłowych GAZ‐SYSTEM S.A. (Customer) for the delivery of coated steel pipes DN 800 for the construction of the Świnoujście-Szczecin pipeline.

Total net value of the Contract is PLN 10,735,999.00, which is PLN 13,205,278.77 gross. Coated steel pipes will be delivered within 4 months from the date of signing the contract.

The contract stipulates the following liquidated damages: 

- for delay in the delivery by the Contractor of the „Loading, Transport, Unloading and Storage Manual for Pipes”  and „Defects Repair Manual” and Contractual Object’s Delivery Schedule within 14 days at the latest from the conclusion of the Contract by the Parties – PLN 1000 for each day of delay in the delivery of each document;

- for delay in the delivery of a given batch of pipes – in the amount of 0.1% of net consideration specified in the contract for each day of delay,

- for delay in the delivery of the repaired delivery object - in case of defects found on the acceptance of the delivery object, in the warranty period - in the amount of  0.5% of net consideration specified in the contract, for each day of delay,

- for Customer’s withdrawal from the contract for reasons attributable to the Contractor in the amount of 20% of net consideration specified in the Contract.

If said liquidated damages do not cover the entire of the Customer’s loss, the Customer has the right to claim compensation in excess of liquidated damages.

Total amount of liquidated damages charged to the Contractor is capped at 20% of net consideration specified in the Contract. Performance bond is 10% of gross consideration specified in the Contract.

The other conditions of the transaction do not differ from the conditions applied commonly for such contracts.
 
Specific legal basis: §5 clause 1 item 3 of the Ordinance of the Minister of Finance of February 19, 2009 on current and periodic information disclosed by the issuers of commercial papers and the conditions for recognizing as equivalent the information required by the laws of a non-member state (Journal of Laws No. 33, item 259 as amended).

SIGNATURES OF PERSONS REPRESENTING THE COMPANY:
Management Board President, Marek Mazurek 2012-06-15
Management Board Vice President, Jacek Podwiński 2012-06-15
 
INFORMATION ON THE ENTITY:
Full name of the issuer: IZOSTAL SPÓŁKA AKCYJNA
Abbreviated name of the issuer:  IZOSTAL S.A
Sector based on the classification of Warsaw Stock Exchange:  Other industry
Address: 47-120 Zawadzkie Polna 3
Telephone: (77) 405 65 00
Fax: (77) 405 65 01
e-mail:info@izostal.com.pl
www.izostal.com.pl
VAT No. [NIP]:756-00-10-641
Statistical No. [REGON]: 530884678