| The Management Board of Work Service S.A. ("Issuer") informs on the signing on 15 July 2016 by the subsidiary of the Issuer, i.e. Exact Systems S.A. with its registered office in Częstochowa ("Subsidiary") of the "term sheet" document ("Term Sheet"), which it took knowledge of on 18 July 2018, concerning to the operations relating to the future acquisition transaction, involving acquisition of 100% of the existing shares of the French limited liability company, acquisition of 100% of the existing shares in the Romanian limited liability company, acquisition of 100% of the existing shares in the Turkish limited liability company and acquisition of 100% of the existing shares in the Moroccan limited liability company (“Target Companies”), operating in the outsourcing industry and specializing in quality control for the automotive industry ("Potential Transaction"), while the Potential Transaction assumes - in the first place - the acquisition of 75% of the existing shares in the Target Companies ("First Stage of Potential Transaction"), followed by the acquisition by the Subsidiary, by means of Call Option or by the current shareholders of the Target Companies by means of Put Option under the terms of the Term Sheet, of the remaining 25% of the existing shares in the Target Companies ("Second Stage of Potential Transaction"). Based on the Term Sheet, the parties agreed to conduct negotiations and due diligence examination to agree on the final terms of the Potential Transaction. The total price of the First Stage of Potential Transaction relating to the Target Companies was established in the amount of EUR 8,000,000 (the "Basic Price of the First Stage of Potential Transaction") with the earn - out mechanism provided for in the Term Sheet which is 75% x 5.15x EBITDA indicator of the Target Companies for the financial year ending on December 31, 2016 decreased by EUR 8,000,000, while EBITDA is to be defined by the Parties to the Potential Transaction in the preliminary contract of sale of shares. The Parties to the Potential Transaction envisage also correcting mechanisms to the price of the First Stage of Potential Transaction. The Preliminary Contract for the sale of shares in the Target Companies will be concluded by October 14, 2016. Contracts for the sale of shares in the Target Companies will be concluded no later than on December 31, 2016. Execution of the Call Option by the Subsidiary, as provided for in the Second Stage of the Potential Transaction will be guaranteed and it will be possible to execute it by December 31, 2021. Execution of the Put Option provided for in the Second Stage of the Potential Transaction by the current shareholders of the Target Companies it will be possible to execute it in the period between March 1, 2019 - December 31, 2021. The conclusion of the preliminary agreement of sale of shares in the Target Companies is subject to the following conditions: (i) positive outcome of the financial, tax and legal due diligence examination in the Target Companies, (ii) completion of the negotiations on transaction documentation by the Parties, (iii) consent to carry out the Potential Transaction by the Supervisory Board of the Subsidiary. The fulfilment of the above conditions does not, however bind any of the parties to execute the Potential Transaction. The final terms and conditions of the Potential Transaction will be included in the preliminary contract of sale of shares in the Target Companies. The potential Transaction is an element of the acquisition strategy of the Subsidiary. Legal base: Art. 17 sec. 1 of MAR (Regulation of the European Parliament and of the Council (EU) No. 596/2014 of April 16, 2014 on market abuse (market abuse regulation) and repealing the Directive 2003/6/EC of the European Parliament and of the Council and the Commission Directive 2003/124/EC, 2003/125/EC and 2004/72/EC). Signatures: Maciej Witucki – President of the Board Piotr Gajek - Vice President of the Board | |
