Kruk S.A. — Capital/Financing Update 2016

Nov 28, 2016

Current Report No. 111/2016

Date: November 28th 2016

Subject: Resolution of the Management Board on issue of bonds under theFourth Public Bond Issue Programme

Legal basis: Art. 17.1 of MAR - Inside information

Text of the report:

Further to Current Report No. 88/2016 of September 19th 2016 on thelaunch Fourth Public Bond Issue Programme (the "Programme"), theManagement Board of KRUK S.A. (the "Issuer" or "Company") announces thaton November 28th 2016 it passed a resolution on the issue of Series AF1bonds ("Bonds") and determination of their final terms and conditions,including the issue price and number of Bonds to be issued. The Bondsare covered by the base Prospectus approved by the Polish FinancialSupervision Authority on November 24th 2016, available from theCompany's website: www.kruksa.pl.

The issue will comprise up to 400,000 unsecured bearer Bonds inbook-entry form, which will be offered in a public offering. The Issuerwill seek to introduce the Bonds to trading on the regulated Catalystmarket operated by the Warsaw Stock Exchange.

In compliance with Art. 54.3 of the Public Offering Act, the Companyannounces that the Bonds will be offered at the issue price equal totheir nominal value of PLN 100 per bond, and that their total nominalvalue will not exceed PLN 40m.

Net proceeds from the issue will be used in accordance with theobjectives of the Bond Issue Programme.

The Bonds will bear interest at a variable rate equal to 3M WIBOR (therate charged for three-month borrowings denominated in PLN on the Polishinterbank market) plus a fixed margin of 3.15 percentage points.

The Company will redeem the Bonds on 8th December 2021, with theprovision that the Issuer will have the right to early redeem all or apart of the Bonds at its own option, but no earlier than six months fromthe allotment date. The Issuer's Management Board will decide at its owndiscretion whether to call any of the Bonds early. The Bondholders willhave no right to call for early redemption, except in situationsreferred to in Art. 74.2, Art. 74.4 and Art. 74.5 of the Act on Bonds ofJanuary 15th 2015, i.e. in the event of the Issuer's failure to timelyfulfil, in whole or in part, its obligations under the Bonds, in theevent of the Issuer's merger with another entity, its division ortransformation of its legal form, if the entity which has assumed theIssuer's obligations under the Bonds is not authorised to issue bonds,or in the event of the Issuer's liquidation.

The Bonds will only confer the rights to cash payments.

The Management Board states that as at the last day of the quarterimmediately preceding the offering of the Bonds, i.e. as at September30th 2016, the Issuer's liabilities totalled PLN 1,524m, includingliabilities under borrowings and other debt instruments of PLN 1,480m,and past due liabilities of PLN 0m

Projects to be financed with proceeds from the issue of the unsecuredBonds will be comparable to similar projects undertaken by the Companyto date.

The Company also reports that pursuant to Art. 24.1 of the PublicOffering Act complete information on the detailed terms and conditionsof the Bonds issued under the Programme (Final Terms and Conditions ofthe Bonds) will be published on the Issuer's website www.kruksa.pl andadditionally on the website of the Offerors: Dom Maklerski BDM S.A.www.bdm.pl, of Dom Maklerski PKO Banku Polskiego S.A. www.dm.pkobp.pl,as well as of Dom Maklerski mBanku www.mdm.pl.