Valinor Public Limited - Dom Maklerski BZ WBK SA

collateral that secures its indebtedness and/or accelerating the loans. Certain of this collateralis over shares. Risks associated with this collateral are described in “– Certain securedlenders may acquire control of the Company if they enforce pledges or other rights overExisting Shares owned by the Selling Shareholder”.Any inability to generate sufficient cash flows from operations in order to serviceindebtedness, could result in an event of default on the part of the relevant member of theGroup, or the unavailability of other sources of capital. Any such event could have a materialadverse effect on the Group’s business, results of operations and financial condition.Certain secured lenders may acquire control of the Company if they enforce pledges orother rights over Existing Shares owned by the Selling ShareholderPrior to the Restructuring, certain members of the Group provided security in respect of loansgranted by Sberbank of Russia OJSC (“Sberbank”) and PJSC Alfa Bank Ukraine (“AlfaBank Ukraine”) to certain members of the Former Group, who are now members of theValars Group. As part of the Restructuring, in order to release these members of the Groupfrom such security, the Selling Shareholder has pledged 40% of the Existing Shares toSberbank (the “Sberbank Share Pledge”) and 15% of the Existing Shares to Alfa BankUkraine (the “Alfa Bank Ukraine Share Pledge”) (see “Restructuring – DebtRestructuring”).The Selling Shareholder has, in an agreement dated 28 June 2011 (the “Sberbank Use ofProceeds Agreement”), agreed to use the proceeds of the sale of the Sale Shares to repaycertain indebtedness of members of the Former Group owed to Sberbank. Following suchrepayment, Sberbank has agreed to hold as collateral only those Shares the post-Offeringvalue of which constitutes 190% of the outstanding indebtedness owed to Sberbank. AnyShares held in excess of this number will be released from the terms of the Sberbank SharePledge provided, however, that at least 25% of the Shares plus one Share shall remain subjectto the Sberbank Share Pledge.The Selling Shareholder has, in an agreement dated on or about the date of this Prospectus(the “Alfa Bank Ukraine Use of Proceeds Agreement”), agreed to use the proceeds of thesale of the Sale Shares to repay certain indebtedness of members of the Former Group owedto Alfa Bank Ukraine. Following such repayment, the Alfa Bank Ukraine Share Pledge shallbe terminated.In addition, the Selling Shareholder has, pursuant to certain finance arrangements withDeutsche Bank, granted a pledge, in favour of Deutsche Bank, over 15% of the ExistingShares (the “Deutsche Bank Share Pledge”), see “Business – Material Contracts –Arrangements with Deutsche Bank”. Deutsche Bank, in its capacity as a lender to theCompany, also currently holds 9.99% of the Existing Shares pursuant to the terms of theDeutsche Bank Call Option, see “Business – Material Contracts – Arrangements withDeutsche Bank”. However, Deutsche Bank is required to return these Shares to the SellingShareholder in circumstances where there is no exercise of the call option and it is furtherrequired to return any balance in circumstances where it is entitled to less than 9.99% of theExisting Shares upon exercise of the call option. Pending exercise of the call option,Deutsche Bank holds economic and voting rights to the Shares, however it is DeutscheBank’s policy not to exercise the same.- 26 -