30. Loans and borrowings

Change in loans and borrowings liabilities:

Facilities agreement between the Company and a consortium of financial institutions

On 21 September 2015, the Company, as the borrower, along with Telewizja Polsat Sp. z o.o., Cyfrowy Polsat Trade Marks Sp. z o.o., Polsat License Ltd. and Polsat Media Biuro Reklamy Spółka z ograniczoną odpowiedzialnością sp.k. concluded a Senior Facilities Agreement with a consortium of Polish and foreign financial institutions, led by Powszechna Kasa Oszczędności Bank Polski S.A., Bank Zachodni WBK S.A., ING Bank Śląski S.A., Société Générale (Global Banking Coordinators) with the participation of PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 1, PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2, BNP Paribas Fortis SA/NV, Bank Polska Kasa Opieki S.A., The Bank of Tokyo-Mitsubishi UFJ Ltd., Bank of China (Luxembourg) S.A., Credit Agricole Corporate & Investment Bank, Credit Agricole Bank Polska S.A., DNB Bank Polska S.A., DNB Bank ASA, HSBC Bank Polska S.A., HSBC Bank plc, Bank Handlowy w Warszawie S.A., CaixaBank, S.A. (Spółka Akcyjna) Oddział w Polsce, mBank S.A., Bank Millennium S.A., Raiffeisen Bank Polska S.A., Goldman Sachs Bank USA, Erste Group Bank AG, Deutsche Bank Polska S.A., and UniCredit Bank AG, London Branch, acting as the Facility Agent and the Security Agent (the “CP Facilities Agreement”).

Based on the CP Facilities Agreement the Company had been awarded a Term Facility Loan up to PLN 1,200 (the “CP Term Facility”) and a Revolving Facility Loan up to PLN 300 (the “CP Revolving Facility”).

The Company used the CP Term Facility and the CP Revolving Facility in particular to:

• (i) repay the indebtedness under the Senior Facilities Agreement of 11 April 2014 between the Company (as the borrower) and a consortium of financial institutions, and
• (ii) fund general corporate needs of the Group.

Senior Facilities Agreement between Polkomtel sp. z o.o. (“Polkomtel”) and a consortium of financial institutions

On 21 September 2015, the Senior Facilities Agreement was concluded between a Company’s subsidiary – Polkomtel as the borrower along with Eileme 2 AB (publ), Eileme 3 AB (publ), Eileme 4 AB (publ), Plus TM Management Sp. z o.o., TM Rental Sp. z o.o., Plus TM Group Sp. z o.o. a consortium of Polish and foreign financial institutions, led by Powszechna Kasa Oszczędności Bank Polski S.A., Bank Zachodni WBK S.A., ING Bank Śląski S.A., Société Générale (Global Banking Coordinators) with the participation of PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 1, PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 2, BNP Paribas Fortis SA/NV, Bank Polska Kasa Opieki S.A., The Bank of Tokyo-Mitsubishi UFJ Ltd., Bank of China (Luxembourg) S.A., Credit Agricole Corporate & Investment Bank, Credit Agricole Bank Polska S.A., DNB Bank Polska S.A., DNB Bank ASA, HSBC Bank Polska S.A., HSBC Bank plc, Bank Handlowy w Warszawie S.A., CaixaBank, S.A. (Spółka Akcyjna) Oddział w Polsce, mBank S.A., Bank Millennium S.A., Raiffeisen Bank Polska S.A., Goldman Sachs Bank USA, Erste Group Bank AG, Deutsche Bank Polska S.A., and UniCredit Bank AG, London Branch, acting as the Facility Agent and Citicorp Trustee Company Limited as the Security Agent (the “PLK Facilities Agreement”).

Based on the PLK Facilities Agreement Polkomtel had been awarded a Term Facility Loan up to PLN 10,300 (the “PLK Term Facility”) and a Revolving Facility Loan up to PLN 700 (the “PLK Revolving Facility”).

The PLK Term Facility and the PLK Revolving Facility was utilized by Polkomtel in particular to:

• (i) fully repay the outstanding debt under the refinanced Polkomtel’s Facilities Agreement dated 17 June 2013;
• (ii) fully repay the indebtedness under the senior notes issued on 26 January 2012 by Eileme 2 AB (publ) – a Company’s subsidiary („HY Notes Indebtedness”); and
• (iii) fund general corporate needs of the Group.

Amendment, Restatement and Consolidation Deed executed between the parties to the CP Facilities Agreement, PLK Facilities Agreement and certain members of the Group

On 21 September 2015 the Amendment, Restatement and Consolidation Deed was concluded between the Company, Polkomtel Sp. z o.o., Telewizja Polsat Sp. z o.o., Cyfrowy Polsat Trade Marks Sp. z o.o., Polsat License Ltd. and Polsat Media Biuro Reklamy Spółka z ograniczoną odpowiedzialnością sp.k., Eileme 2 AB (publ), Eileme 3 AB (publ), Eileme 4 AB (publ), Plus TM Management Sp. z o.o., TM Rental Sp. z o.o., Plus TM Group Sp. z o.o. and the consortium of Polish and foreign financing institutions (the “Amendment, Restatement and Consolidation Deed”).

According to the Amendment, Restatement and Consolidation Deed, upon repayment of the HY Notes Indebtedness, the indebtedness under the PLK Facilities Agreement was refinanced using the funds made available under the CP Facilities Agreement, as amended in the Amendment, Restatement and Consolidation Deed. The HY Notes Indebtedness were repaid 1 February 2016.

The Amendment, Restatement and Consolidation Deed amends the CP Facilities Agreement as follows:

• the maximum amount of the CP Term Facility is PLN 11,500, and the maximum amount of the CP Revolving Facility is PLN 1,000;
• the Company and other Group members will establish additional collaterals for the facilities granted on this basis. These collaterals include, in particular, registered pledges on collections of movables and economic interests of variable composition comprised in the enterprise of certain members of the Group, registered and financial pledges on shares in the Group members, registered and financial pledges on receivables related to bank accounts kept for certain members of the Group, ordinary and registered pledges on selected trademarks, assignments of rights for security, mortgages, notarial submissions to enforcement and similar collaterals on shares (interests) or assets of members of the Group, to be governed by foreign laws.

The CP Term Facility and the CP Revolving Facility bear interest at a variable rate equal to WIBOR for the relevant interest period plus margin. The margin on the CP Term Facility and the CP Revolving Facility depends on the ratio of net consolidated indebtedness to consolidated EBITDA in such a way that the lower the ratio – the lower the margin. The CP Term Facility and the CP Revolving Facility are to be repaid in quarterly installments of variable value with the final repayment date for each of these facilities set at 21 September 2020.

On 26 January 2016, Polkomtel (an indirect subsidiary of the Company) increased utilization of the PLN facility by PLN 4.8 billion (not in million) pursuant to the terms of the Amendment, Restatement and Consolidation Deed.

The CP Revolving Facility as at 31 December 2016 was not utilized. The CP Revolving Facility and the PLK Revolving Facility as at 31 December 2015 were not utilized.

In accordance with the provisions of the Amendment, Restatement and Consolidation Deed, the Company, Polkomtel and other members of the Group may incur additional facilities. The terms of such additional facilities will be established individually in separate additional facility accession deeds and their terms will have to satisfy certain criteria.

Claims related to the CP Facilities Agreement and the PLK Facilities Agreement are secured by collaterals established by the Company, Polkomtel and other members of the Group as a security. A detailed description of the established securities is presented in the Management Report in note 4.6.6.

Agreement with Bank Pekao S.A.

On 7 May 2009 the Company signed an agreement with Bank Pekao S.A. defining rights and obligations of the parties should the Company order the bank to issue a guarantee or a letter of credit. Bank’s total commitment regarding the issued guarantees and letters of credit may not exceed PLN 20.0. As at 31 December 2016 the bank issued guarantees in the total amount of PLN 2.6 and EUR 1.2.

Agreement with PKO BP

On 29 November 2012 Company’s indirect subsidiary signed a framework agreement with PKO BP S.A. defining rights and obligations of the parties should the company order the bank to issue a guarantee. Bank’s total commitment regarding issued guarantees relating to tenders and trade agreements may not exceed PLN 50.0. As at 31 December 2016 the bank issued guarantees in the total amount of PLN 13.8 and EUR 3.5.

On 26 February 2016 Company’s indirect subsidiary signed an annex to a framework agreement with PKO BP S.A. defining rights and obligations of the parties should the company order the bank to issue a guarantee. Bank’s total commitment regarding issued guarantees relating to tenders and trade agreements may not exceed PLN 3.5. As at 31 December 2016 the bank issued guarantees in the total amount of PLN 3.2.

Agreement with ING Bank Śląski S.A.

On 12 February 2014 the Company’s indirect subsidiary signed an agreement with ING Bank Śląski S.A. defining rights and obligations of the parties should the company order the bank to issue a guarantee. Bank’s total commitment regarding the issued guarantees may not exceed PLN 2.5. As at 31 December 2016 the limit was unutilized.

Early repayment of the loan

On 29 April 2016 Midas Group made an early repayment of the loan granted by Pekao Bank in the amount of PLN 326.3. As a result of the said early repayment Midas group repaid its total indebtedness under the facility agreement and the bank released all the collateral securing the facility.

On 10 May 2016 Midas Group made an early repayment of the loans granted by Plus Bank in the amount of PLN 41.1. As a result of the said early repayment Midas Group repaid its total indebtedness under the facility agreement and the bank released all the collateral securing the facility.

Accession to the loan agreement

On 27 May 2016 Midas and Litenite Ltd. (indirect subsidiaries of the Company) acceded to the facilities agreement dated 21 September 2015 entered into initially by Cyfrowy Polsat, Polkomtel and other Group entities. Midas and Litenite Ltd. also acceded to the respecive Intercreditor Agreement.

On 29 June 2016 Aero 2 (indirect subsidiary of the Company) acceded to the facilities agreement dated 21 September 2015 entered into initially by Cyfrowy Polsat, Polkomtel and other Group entities. Aero 2 also acceded to the respective Intercreditor Agreement.

The entities (Midas, Litenite and Aero 2) acceded to the facilities agreement as guarantors only.