Teraplast SA — Audit Report / Information 2019

Jul 31, 2019

Ernst & Young Assurance Services SRL Bucharest Tower Center Building, 22nd Floor 15-17 Ion Mihalache Blvd., Sector 1 011171 Bucharest, Romania

Tel: +40 21 402 4000 Fax: +40 21 310 7193 office@ro.ey.com ev.com

Independent Limited Assurance Report on the information included in the current reports issued by Teraplast SA in accordance with requirements of Law 24/2017 (Article 82) and Regulation no. 5/2018

To the management of Teraplast S.A.

We were engaged by the Teraplast S.A. (hereinafter "the Company ") to perform certain procedures in accordance with Regulation no. 5/2018 of Financial Supervisory Authority ("ASF") with all its subsequent amendments and report on the information included in the attached current report (hereinafter "Reporting Schedule") (dated 29 July 2019) that has been prepared by the Company in accordance with the requirements of the Law 24/2017 (Article 82) (" the criteria") to report to the Financial Supervisory Authority ("FSA") and to the Bucharest Stock Exchange for the period from 1 January 2019 to 30 June 2019. The Reporting Schedule has been prepared by the Company based on legal documents signed by the Company with its administrators, employees and significant shareholders as well as with the persons related to them. The Reporting Schedule is the responsibility of the Company's management. Our procedures have been performed exclusively on the Reporting Schedule mentioned above covering the period 1 January 2019 to 30 June 2019.

Specific Purpose

This report is intended solely for the purposes specified in the first paragraph above and for your information and must not be used for any other purpose. The report refers exclusively to the Reporting Schedule and must not be associated with any Company's financial statements as a whole. Our procedures have been performed exclusively on the contracts signed during the period 1 January 2019 to 30 June 2019.

Management's Responsibilities

The Company's management is responsible for the preparation of the Reporting Schedule in accordance with the requirements of the Law 24/2017 (Article 82) (" the criteria"). In particular, the Company's management is responsible for internal controls being designed and implemented to prevent the Reporting Schedule from being materially misstated.

In addition, the Company's management is responsible for ensuring that the documentation provided to the auditor is complete and accurate. The Company's management is also responsible for maintaining the internal control system that reasonably ensures that the documentation described above is free from material misstatements, whether due to fraud or error.

Auditor's Responsibilities

We conducted our assurance engagement in accordance with International Assurance Standards, particularly ISAE 3000 (revised), "Assurance Engagements Other than Audits or Reviews of Historical Financial Information", as adopted by the Chamber of Financial Auditors in Romania. These regulations require that we comply with ethical standards and plan and perform our assurance engagement to obtain limited assurance about the Reporting Schedule.

We apply International Standard on Quality Control 1 (ISQC 1), and accordingly, we maintain a robust system of quality control, including policies and procedures documenting compliance with relevant ethical and professional standards and requirements in law or regulation.

We comply with the independence and other ethical requirements of the IESBA Code of Ethics for Professional Accountants, which establishes the fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.

The procedures selected depend on the auditor's judgment. The procedures include, in particular, inquiry of the personnel responsible for financial reporting and risk management and additional procedures aimed at obtaining evidence about the Reporting Schedule.

The assurance engagement performed represents a limited assurance engagement. The nature, timing and extent of procedures performed in a limited assurance engagement is limited compared with that necessary in a reasonable assurance engagement. Consequently, the level of assurance obtained in a limited assurance engagement is lower.

In respect of the Reporting Schedule of the Company we have performed the following procedures:

1) We have obtained the attached Reporting Schedule from the Company and agreed that the signatures on the Reporting Schedule are those of relevant representatives of the Company and we have undertaken a comparison of the details required to be included in the Reporting Schedule as indicated in Law 24/2017 (Article 82) to the information actually included by the Company.

• 2) We have compared details, for the individual contracts/agreements we have considered, as detailed in this Report, to determine if the content of the Reporting Schedule is consistent, in all material respects, with information as per signed contracts and agreements presented to us and that the presented documents have been signed by representatives of the Company that are indicated in the authorized signature schedule provided to us by the Company. As applicable, our procedures have compared Reporting Schedule to the contract and agreement documentation for consistency of details on: the parties which signed the legal document; the date when documentation was signed and the nature of the documentation; the description of the type of goods/services as indicated in the documentation; the total value of the contract/agreement documentation, and, as applicable, contract related terms and conditions.
• 3) We have compared details disclosed in the Reporting Schedule for consistency with the information provided to us from discussion with management and to the extent indicated in contract/agreement documentation, in relation to the basis and nature of the contract/agreement entered into by the parties.
• 4) From discussions with the management and from perusal of Company policies and procedures provided to us, we have considered the consistency of the transactions performed with administrators, employees and significant shareholders, as well as with persons related to them with the Company's policies and procedures.
• 5) To the extent that there is a market price for the goods or services provided by administrators, employees and significant shareholders, as well as with persons related to them, we have discussed the basis for the price agreement and considered if, to the extent applicable, the prices agreed are consistent with that used for third (other) parties, where similar goods or services could be provided. To the extent that no market prices are available, we have analyzed if the transactions have been performed based on the signed approved contracts.

Our procedures have been performed only on the contracts included in the attached Reporting Schedule, that have been concluded/modified during 1 January 2019 to 30 June 2019 and that have an estimated value during the reporting period above 50,000 Euros. We have not performed any procedures to verify whether the Reporting Schedule includes all the transactions and details that the Company has to report according to Article 82 of Law 24/2017 for the reporting period.

Conclusion

Based on the procedures performed and evidence obtained, as described above, regarding the legal documents which are included in the Reporting Schedule, nothing has come to our attention that causes us to believe that:

a) related contracts/agreements presented to us.

b) the requirements of the legislation.

c) representatives of the Company.

d) The prices have not been established by mutual agreement between the parties in accordance with the type of goods/services and also by considering other terms and conditions mentioned in the respective contracts signed between the parties.

e) transactions have been completed with administrators, employees, significant shareholders, as well as with the persons related to them, are not established on the basis of the contracts signed by the Company according to the type of services and to other terms and conditions agreed between the parties.

Our report is solely for the purpose set forth in the first paragraph of this Report and for your information and is not to be used for any other purpose.

This Report relates only to the Reporting Schedule as mentioned above and does not extend to any other reports of the Company, individually or taken as a whole.

On behalf of Ernst & Young Assurance Services SRL

Alexandru Lupea Partner

Emst & Young Assurance Services S.R.L 2 9. IUL. 2019 Signed for identificatio

29 July 2019 Bucharest, Romania

Attachment

1. Reporting Schedule

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TeraPlast®	のおりかからありた

semnarii contractului. Termen de plata: virament bancar. 3 luni, de la data Modalitate de plata:	Nu este cazul	Nu este cazul
este purtator Imprumutul dobanzii de referinta a dobanda, la nivelul BNR de
Nu exista	Nu este cazul	Nu este cazul
Teraplast: 17.193 Lei Datorii aleTeraplast: Datorii catre 0 lei	datorii in legatura cu cu TeraSteel d.o.o. creante in legatura 23.026.789 LEI *2. I eraplast SA are Serbia: 0.00 LEI: Teraplast SA are TeraSteel d.o.o. Serbia .:	datorii in legatura cu 22.347.263,29 lei 3: cu TeraSteel d.o.o. creante in legatura Teraplast SA are Teraplast SA are Serbia: 0.00 lei: TeraSteel d.o.o. Serbia .:
12.000.000 lei a contractului Valoarea este de totala	acordului este de 1.711.000 Valoarea euro	La 12.02.2019, din total creante de la Teraplast Hungaria Kf, 945.102 lei reprezinta pincipal plus dobanda in contractului de imprumut in vigoare; Anexei nr.1 143.849.60 Valoarea este de euro
societatii Depaco unui imprumut Acordarea SRL	Conversia in aport la de creditare incheiat parte a contractului Serbia a sumei de capitalul social al valoare totala de in 06.06.2017 in TeraSteel d.o.o. 6.250.000 euro 1.711.000 euro.	dobanzii aport la urmare a conversiei Reducerea datoriei 1.711.000 euro, ca capitalul social al TeraSteel d.o.o. sumei acesteia din a Serb imprumut in aferenta cu valoarea
nr.423033 / 11.02.2019 Contract creditare de	modificare a Contractului de creditare 06.06.2017 incheiat in Acord de	Acordul din 15 Anexa nr.1 la Contractului de creditare incheiat in din 6 iunie modificarii mai 2019 vederea 2017
11.02.2019	15.05.2019	24 iunie 2019
(fosta DEPACO S.R.L.) WETTERBEST S.R.L.	TeraSteel d.o.o. Serbia	TeraSteel d.o.o. Serbia
2.	3.	4.

² La 27.06.2019, valoarea de 22.347.263,29 lei este in legatura cu contractul de impunut in 20.715.711,8 lei principal si 1.631.551,49 lei dobanda.

dobanda.

² La 14.06.2019, din valorea de 23.026.789 LEI este in primul n vigoare si se compune din 20.715.792 LEI prințipal (contravaloarea a 4.539.000 eu) si 2.310.97 LEI

TeraPlast 0 TeraGlass wetterbest TeraSteel TeraSteel TeraPlast TeraPlast TERA PLAST GROUP

Sărățel, comuna Șieu-Măgheruș, DN15A, km 45+500, jud. Bistrița Năsăud, 427301 CUI 3094980, J06/735/1992, Capital social subscris și vărsat: 107.024.527,40 lei Tel: 0374 461 529/ Fax: 0263 231 221/office@teraplast.ro www.teraplast.ro TERAPLAST SA

A

A TeraPlast SIME & SARA

Nr. Crt.	Persoana fizica/juridica Teraplast a incheiat cu care Societatea actul juridic	incheierii actului Data	actului Natura	Obiectul actului	Valoarea estimata a actului	reciproce intre partile actului Creantele	Garanti constit uite ile	si modalitatile de Termenele plata
				Acte aditionale incheiate de Societatea Teraplast S.A. in calitate de Furnizor/Vanzator
1.	TERAGLASS BISTRITA SRL	28.02.2019	nr.5622/10.06. Act aditional contractul cadru de vanzare nr.10 la 2015	de vanzare nr.5622/10.06.2015 pana la data de 28.02.2020 Prelungirea valabilitatii contractului cadru	2019 este de 7.500.000 lei contractului pentru anul Valoarea estimata a fara T.V.A.	Creante totale ale Datorii totale ale 5.807.631 lei *4 Teraplast : Teraplast : 54.667 lei	exista Nu	120 de zile de la data virament bancar sau emiterii facturii, prin compensare
Ni	TERAPLAST HUNGARIA K.F.T.	28.02.2019	Act aditional vanzare nr. 24.04.2017 contractul cadru de 7001 / nr. 8 la	cadru de vanzare pana la data de 28.02.2020 rea valabilitatii nr. 7001/24.04.2017 Prelungı contractului	contractului pentru anul 2.500.000 lei fara TVA 2019 este de estimata a Valoarea	Creante totale ale Datorii totale ale 1.579.102 lei *5 Teraplast : Teraplast: 21.496 lei	exista Nu	facturii, prin 90 de zile de la data virament emiterii bancar
3.	Teraplast Recycling S.A.	01.04.2019	vanzare linie de business Contract de reciclare	a liniei de business vânzare mijloace fixe, transfer Transferul către S. Teraplast (vânzare stocuri, furnizori, închiriere imobile și angajați, cesiune contracte echipamente) de reciclare Recycling S.A.	Valoarea contractului este de 22.875.886 lei	Creante totale ale ale l eraplast : 0 lei: 22.875.886 lei; Teraplast : Datorii totale	Nu este cazul	se aplica o dobanda de Termenul de plata este 30.06.2019 urmand a business incepand cu integrale; Modalitatea de plata este transfer 5%/an din pretul de data de 01.04.2019 vanzare al liniei de pana la data platii bancar
4.	Teraplast Recycling S.A.	24 iunie 2019	24.06.2019 Contract de nr. 430184 cumparare vanzare	data de 30.06.2020 urmand a se succesive de cate 12 luni daca Contractul este valabil pana la prelungi automat cu perioade niciuna dintre parti nu solicita Vanzare de deseuri PVC.	g Valoarea estimata anuala contractului este de 1 milion lei:	Creante totale ale 24.468.808,66 lei *6 Datorii totale ale Teraplast: Teraplast	Nu este cazul	Termenul de plata este 15 zile; Modalitatea de plata este transfer compensare bancar sau

Sărățel, comuna Șieu-Măgheruș, DN15A, km 45+500, jud. Bistrița Năsăud, 427301 CUI 3094980, J06/735/1992, Capital social subscris și vărsat: 107.024.527,40 lei Tel: 0374 461 529/ Fax: 0263 231 221/office@teraplast.ro www.teraplast.ro TERAPLAST SA

2.888.345,04 lei;

rezilierea.

DI

ു TeraPlast [][] TeraGlass' wetterbest TeraSteel TeraSteel TeraPlast TeraPlast TERA PLAST GROUP

				virament bancar sau 60 de zile de la data emiterii facturii, prin compensare	Termenul de plata este 15 zile; Modalitatea de plata este transfer compensare bancar sau
				exista Nu	Nu este cazul
				Creante totale ale Datorii totale ale -1 12.255.252 lei I eraplast: 339.385 lei I eraplast:	24.468.808,66 lei; *8 Creante totale ale 2.888.345,04 lei; Datorii totale ale l eraplast: I eraplast:
	principal plus dobanzi in contul contractului de imprumut;			2019 este de 1.000.000 lei contractului pentru anul Valoarea estimata a fara T.V.A.	C Valoarea estimata anuala contractului este de 30 milloane lei:
4 La 04.03.2019, dir total creante de la Teraglas Bisitia SRL, 3.314.878 le reprezita sune de incasa in contractului de transfer linie de business din 2015;		e La 27.06.2019, din total creante de la Terapast Recyding SA, valorea de 22.875.886,27 lei reprezinta sume de incastin aprilie 2019	Contracte incheiate de Societatea Teraplast S.A. in calitate de Cumparator	metalice, accesorii metalice, in Cumpararea de armaturi baza comenzilor emise	data de 30.06.2020 urmand a se succesive de cate 12 luni daca Cumpararea de matene prima. este valabil pana la prelungi automat cu perioade niciuna dintre parti nu solicita rezilierea. Contractul	8 La 27.06.2019, din total create de la Terapast Reyding SA, valoarea de 22.875.886,77 le reprezinta sume de incastin aprilie 2019 La 04.03.2019, din total creane de incasted SA, 12.243.903 lei reprezinta sume de incasat in contul dividendelor distribuite trimestrial in 2018;	Diroctor Condrol
				Contract cadru cumparare nr. de vanzare - valabil 12 luni 01.03.2019 424029 /	cumparare nr. Contract de 24.06.2019 vanzare 441 /
				01.03.2019	24 iunie 2019
	5 La 04.03.2019, din total creante de la Teraplast Hungaria Kft, 945.102 lei reprezinta			TERASTEEL S.A.	Teraplast Recycling S.A.
					2

Sărățel, comuna Șieu-Măgheruș, DN15A, km 45+500, jud. Bistrița Năsăud, 427301 CUI 3094980, J06/735/1992, Capital social subscris și vărsat: 107.024.527,40 lei

TERAPLAST SA

Tel: 0374 461 529/ Fax: 0263 231 221/office@teraplast.ro

www.teraplast.ro