Agreement on the merger plan of LC Corp S.A. and its subsidiary company – LC Corp Invest XX Sp. z o.o.

The Management Board of LC Corp S.A. (“Issuer”) informs that on 10 May 2019 the management boards of LC Corp S.A. and the Issuer’s subsidiary company: LC Corp Invest XX Sp. z o. o. with its registered office in Wrocław, approved resolutions accepting the merger plan of the Issuer (“Acquiring Company”) with the Issuer’s subsidiary company – LC Corp Invest XX Sp. z o.o. with its registered office in Wrocław (“Acquired Company”).

The planned merger will be carried out in compliance with Art. 492 §1.1 of the Code of Commercial Companies (“CCC”) by transfer of all assets of the Acquired Company to the Acquiring Company as the sole shareholder of the Acquired Company.

The merger will be carried out as an element of the simplification process of the organisational structure of the entire LC Corp group and of the implementation of the strategy in accordance with which all development investments are to be carried out by the Acquiring Company.  Additionally, the merger will result in concentration of the assets held by the Acquired Company in the Acquiring Company, will simplify and accelerate cash flows and generation of profit by the Acquiring Company, also for the purpose of dividend distribution.

Since all the shares in the Acquired Company are held by the Issuer, which is the sole shareholder, the merger will be carried out in compliance with Art. 516 §6 in connection with § 1 and § 5 of CCC, as follows:

a) without issue of shares in the Acquired Company to the shareholders of the Acquiring Company,
b) without identifying in the merger plan of the exchange ratio of shares in the Acquired Company to the shares of the Acquiring Company,
c) without identifying in the merger plan of the principles related to the shares in the Acquiring Company,
d) without identifying in the merger plan of the date as from which the shares of the Acquiring Company issued to the shareholders of the Acquired Company will entitle to profit distributions of the Acquiring Company.

Considering that all shares in the share capital of the Acquired Company are held by the Issuer and therefore the merger is to be carried out in a simplified manner, pursuant to Art. 515 § 1 of CCC the merger will take place without any increase of the Issuer’s share capital, and pursuant to Art. 516 § 6 of CCC, the merger plan will not be audited for correctness and reliability of the merger plan and no reports will be made of the management boards of the companies involved in the merger.

Additionally, pursuant to Art. 499 of CCC, due to the fact that the Issuer as a public company, has been publishing and disclosing to its shareholders semi-annual financial statements, it is not required that the Issuer as the Acquiring Company prepares information on its accounting condition made for the merger, as referred to in Art. 499 § 2.4 of CCC and thus it was not made or attached to the merger plan.

Pursuant to the provisions of Art. 500 § 2(1) of CCC, the Merger Plan needs not be published in the Monitor Sądowy i Gospodarczy in the manner provided for by the provisions of Art. 500 § 2 of CCC since on 10 May 2019 the merger plan was published free of charge on the web site of the merging companies at https://develia.pl/ in the tab “Investors Relations” – “Other”.  Additionally, the Company publishes the merger plan as an appendix to this current report.

Legal basis: Art. 17.1 of MAR – inside information