(i) a request to transfer to Prokom a number of shares that corresponds to the quotient of the amount equal to the direct equity investment in Company’s shares in the amount of PLN 10,000,000 performed by Prokom and the issue price equal to PLN 10.00, as well as
(ii) a call to offer to Prokom 1,000,000 ordinary bearer Company shares at an issue price of PLN 10.00 per share, that is for a total amount of PLN 10,000,000.
 
Furthermore, on 8 March 2011 — in compliance with the provisions of the agreement dated 13 January 2009 concluded with Prokom regarding, among other things, expanding the scope of the call option to cover all accounts receivable by Prokom from the Company (“Agreement with Prokom I”), which was the subject of current report no 4/2009, and the agreement concluded on 14 May 2009 with Prokom, setting forth the terms on which Prokom makes its assets available to the Company to use as security for the credit facility extended by the consortium of PKO Bank Polski S.A. and Bank Gospodarstwa Krajowego under the agreement dated 21 March 2007 (“Agreement with Prokom II”), which was the subject of current report no 45/2009 — the Company received from Prokom:
a) a request to transfer to Prokom a number of shares that corresponds to the quotient of (i) the accounts payable to Prokom by Petrolinvest for a PLN 11,337,151.37 advance towards the fee for providing and maintaining collateral for the credit facility charged for the period until 7 March 2011, the commercial accounts payable in the amount of PLN 2,527,255.62 charged for the period until 31 December 2010 and the accounts payable to Prokom by Petrolinvest pursuant to the agreement dated 3 February 2001 on paid collateral in the amount of PLN 239,075.34, and (ii) an issue price of PLN 10.00;
b) a call to offer to Prokom, within the period of 5 days from 8 March 2011, 1,410,348 ordinary bearer Company shares at an issue price of PLN 10.00 per share, that is for a total amount of PLN 14,103,480.

In connection with the said requests and calls, and also in connection with the resolution of the Extraordinary General Shareholders' Meeting dated 30 October 2010 regarding the issue of subscription warrants, conditional Company share capital increase, the exclusion of the pre-emptive rights of the existing shareholders of the Company and amendment of the statutes of the Company (the "Issue Resolution") published in current report no 85/2010, on 8 March 2011, the Management Board of the Company adopted a resolution regarding the offering of registered subscription warrants entitling to take up series B Company shares (“Subscription Warrants”) and setting forth detailed terms and conditions of the issue of the Subscription Warrants. The Management Board decided to issue 2,410,348 Subscription Warrants and offered them for subscription to Prokom. Subscription Warrants were subsequently taken up by Prokom. At the same time Prokom exercised its rights under the Subscription Warrants to take up series B shares and filed a statement of acquisition of 2,410,348 ordinary series B bearer shares of the Company.

The issue price of the ordinary series B bearer shares, issued to holders of Subscription Warrants on the basis of the Issue Resolution within the scope of the conditional increase of the Company's share capital, was set by the Management Board at PLN 10.00 per share, considering statutory restrictions regarding the minimum issue price of shares. The issue price was approved by the Supervisory Board on 8 March 2011.

Payments of Prokom for the series B shares were made by netting mutual accounts receivable/accounts payable by the Company and Prokom. On 8 March 2011, the Company concluded a netting agreement with Prokom under which the Company and Prokom netted an outstanding account receivable by the Company under the subscription for series B shares totalling PLN 14,103,480 with outstanding accounts payable by the Company to Prokom, set forth in the second paragraph, item a) of this current report. As a result of the netting, the cash contribution due by Prokom to the Company in connection with the take-up by Prokom of 1,410,348 series B shares was fully covered.

The value of the cash payment made by Prokom for the take-up of 1,000,000 series B shares was PLN 10 million. Funds acquired by the Company will first be used to finance works related to the Shyrak 1 well within the scope of the exploration and production projects in Kazakhstan.

The current total value of financing invested in PETROLINVEST S.A. by Prokom and the entities indicated by Prokom as part of performance of the Agreement on Financing was more than PLN 102m, of which payments made in the current year amounted to PLN 34m.

Download current report no. 17/2011