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Concluding of the meaning agreement by PROCHEM S.A.

Concluding of the meaning agreement by PROCHEM S.A.

Date of publication: 12.07.2012

On 12 July 2012 PROCHEM S.A. signed an agreement with Mineral Wax Factory S.A. located in the Republic of Belarus in Swisloch.

The contract covers the „turnkey” construction of system for the production of refined paraffin, oil and grease along with the development of the energy complex.

The price of the contract is 48 200 000 EUR plus duty and taxes (including VAT) charged on the territory of Belarus. The contract is to be financed with a bank credit. Payments will be made from established letters of credit. The agreement provides for the granting 15 % down payment. Deadline for completion of the works is 33 months. The terms and contractual obligations will begin upon the final decision on granting the loan (confirmation of funding) and the establishment of the letter of credit. In the absence of confirmation of the funding agreement is terminated.

The agreement provides for penalties for failure to meet the deadline of the final performance of the contract in the amount of 0.01% of the contract price for each day of delay, but not more than 5% of the contract price. Payment of penalties does not exclude the right to claim damages in excess of those penalties, but not more than 10% of the contract price.