Management Board of Qumak S.A. (hereinafter referred to as the “Company”) informs that on 29 December 2017 business negotiations as well as agreement on and signing the content of a settlement (hereinafter referred to as the “Settlement”) with regard to the contract of 29 August 2013 entered into between the Company and State Treasury – National Water Management Authority and Institute of Meteorology and Water Management – National Research Institute (hereinafter jointly referred to as the “Ordering Party”) concerning design, construction and implementation of an IT system of the country’s protection from extraordinary threats (hereinafter jointly referred to as the “ISOK”) as well as providing warranty service after implementation of this system (hereinafter referred to as the “Agreement”).
About signing a letter of intent on undertaken negotiations, the Company informed in a current report no. 78/2017 on 27 November 2017.
Content of the signed Agreement covers mutual confirmation on the legal and factual state of matters between the Parties, in particular the Company confirmed a complete implementation by the Company within the Stages 1-4. There was also confirmed that the Contract is still valid and Qumak is obliged to perform Stage 5. The Parties reached mutual compromises within the scope of the disputed functions of the system and changing mutual scope of services within the scope of warranty service.
In the signed Settlement there was adopted a new material and financial schedule of the ISOK system realization within the scope of Stage 5, in accordance with which until 27 July 2018 the works on the ISOK system will be completed. Remuneration for performing the Stage 5 of the Agreement and providing warranty service shall not change will be PLN 28 301 298.75 gross.
In the moment of entering into a Settlement, the Parties will renounce mutual claims with regard to performing the Contract, including claims for payment of contractual penalty, damages as could arise from not performing or improper performance of the Contract.
Simultaneously, the Parties signed a second letter of intent concerning settlement negotiations within the frames of the project ISOK. In the letter of intent the Parties confirmed that the business negotiations and technical elements of the settlement are completed, and agreed on the content of the Settlement and Appendices to the Settlement. Next, the Parties will undertake steps to obtain relevant approvals of the agreed conditions of the Settlement from public institutions, which co-operate or supervise the Employer and the Company’s supervision body.
Entering into the final Settlement depends on these validations and on approval of the settlement by a relevant court, but the Parties’ intention is to enter into the settlement within the frames of a court settlement until 31 January 2018.
The Company informed about the course of a dispute with the Employer in current reports no. 23/2016 of 28 June 2016, 26/2016 of 22 July 2016, 28/2016 of 16 August 2016, 32/ 2016 of 11 October 2016, 34/2016 of 21 October 2016 and 78/2017 of 27 November 2017.
Article 17 section 1 MAR – confidential information.