Jan 23, 2007. /Lesprom Network/. The management board of Pfleiderer Grajewo S.A. reports that on January 15, 2007 the subsidiary Pfleiderer MDF Sp. z o.o. and PKO Bank Polski S.A. concluded a credit agreement, PAP Market Insider reported. The agreement provides for an investment credit to be used for the construction of an MDF production plant in Grajewo, comprising PLN 102.8 million ($34.6 million) and a PLN equivalent of Euro 34.3 million as well as a working capital credit of PLN 60 million ($20.2 million) for the financing of VAT liabilities during the construction period and day-to-day operations following the launch of the plant. The value of the agreement as at the date of its execution is PLN 295.8 million ($99.5 million). The agreement provides for the repayment of the investment credit in installment over eight years, while the working capital credit is to be repaid in full after three years from the date of the credit agreement. The credits are secured on the assets of Pfleiderer MDF Sp. z o.o.; the agreement does not provide for any sureties or guarantees by Pfleiderer MDF Sp. z o.o.’s shareholders. The collateral of repayment of the credit shall be in particular: a) register pledge up to the amount of PLN 450 million ($151.6 million) to be constituted on the assets of Pfleiderer MDF Sp. z o.o., being a changeable set of objects and rights, b) mortgage up to the total amount of PLN 356.9 million ($120.2 million) to be constituted on a plot of land located in Grajewo on Wiórowa street of the area of 10 hectares 9 343 square meters. Pfleiderer MDF Sp. z o. o. signed on January 15, 2007 a declaration on constituting in favour of PKO Bank Polski S.A. the aforementioned mortgage and signed the agreement on constituting the register pledge. As of the date of signing the credit agreement neither the value of the plot of land to be encumbered with the mortgage nor the value of the assets to be encumbered with the pledge exceed 10% of the equity of Pfleiderer Grajewo S.A. The value of the property encumbered with the collateral will increase during the performance of the investment - construction of the MDF production plant. The criterion for considering the credit agreement as a material agreement is the amount of the equity of Pfleiderer Grajewo S.A.