1. Amendment to Article 4 para. 2 of the Articles of Association The current provision of Article 4 para. 2 of the Articles of Association shall be amended by newly adding the following language after the second point:
“- arranging financing and development of systems of financing in the companies within the holding
- human resources development and the development of human resources management in the companies within the holding”
2. Amendment to Article 6 of the Articles of Association
The existing Article 6 of the Articles of Association shall be amended by deleting the second sentence which reads: “If neither the chairman nor the vice-chairman are chosen, then at least five members of the board act jointly”.
3. Amendment to Article 10 para. 6 of the Articles of Association
The current language of Article 10 para. 6 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following: “6. Unless resolved otherwise by the general assembly, the due payment date of dividends is the day that follows two months after the day of the general assembly taking place, which decided on the payment of dividends, and by numbered labelling is in concordance with the day of such a general assembly taking place.”
4. Amendment to Article 12 para. 2 of the Articles of Association
The current language of Article 12 para. 2 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “2. The general assembly is responsible for the following:
a) Deciding on changes to the Articles of Association, unless this concerns any change as a result of an increase in base capital by the board of directors according to Article 210 of the Commercial Code and Article 28 paragraph 7 of this Articles of Association, or any change that occurred on the basis of other legal actualities;
b) Deciding on an increase in base capital and on authorising the board of directors to decide on an increase in base capital according to Article 210 of the Commercial Code and Article 28 paragraph 7 of this Articles of Association, deciding on the possibility of including monetary receivables towards the company against debt for paying the issue price;
c) Deciding on issue of debentures pursuant to Article 160 of the Commercial Code;
d) Deciding on a decrease in base capital;
e) Deciding on a merger, transfer of assets to one shareholder or division, or possibly on a change in the legal form of the company;
f) Decision on dissolving the company with liquidation, appointment and discharge of liquidator, including setting the level of his remuneration, approval of proposal for division of liquidation value;
g) Approval of non-monetary deposit or determination of company authority that will decide on approving the value of non-monetary deposit during authorisation by the board of directors on deciding on an increase in base capital according to Article 210 of the Commercial Code and Article 28 paragraph 7 of this Articles of Association;
h) Deciding on exclusion or restriction of priority right to obtain exchangeable or priority debentures or subscription of new shares of the company for the purpose of increasing base capital for company shareholders;
i) Decision on issuing equity warrants for enforcement of priority right to obtain exchangeable and priority debentures, on subscription of shares during enforcement of rights from priority debentures or on subscription of shares during an increase in the base capital of the company;
j) Decision on change in form or type of shares and on change to rights linked with a certain type of shares, decision on division or fusion of shares, decision on issue of preliminary list for replacing shares;
k) Decision on quotation of subscriber securities of the company according to special legal regulation and on their withdrawal from trading on the official market;
l) Decision on acquisition of own shares of the company, where such decision is required by the Commercial Code;
m) Decision on the establishment and liquidation of any fund created from profits and on the rules on using of such funds;
n) Election and discharge of members of the supervisory board, with the exception of the members of the supervisory board elected and discharged by employees pursuant to Article 200 of the Commercial Code, and decision on confirmation of their election according to Article 38l paragraph 6 of the Commercial Code;
o) Decision on remuneration for members of the board of directors and the supervisory board, approval of contract on performance of function of supervisory board members;
p) Granting of prior agreement with entering into a contract on credit or loan between the company and a member of the board of directors, the supervisory board, head of procuration or another person who is authorized to enter into such a contract in the name of the company, or by people close to them. Alternatively, granting of a contract the content of which is the securing of liabilities of these people or free transfer of property from the company to these people;
q) Granting of prior agreement with entering into a contract on credit or loan with a person other than the persons stated in Article p) or on securing of liability of such a person, if persons stated in Article p) are authorized to enter into such a contract in the name of this other person. This does not apply if it concerns the provision of a loan or credit by a controlling person to a controlled person or securing of liabilities of the controlled person by the controlling person;
r) Granting of prior agreement with entering into a contract on free transfer of property to a shareholder;
s) Approval of annual report on business activity of the company and the state of its property;
t) Approval of an ordinary or extraordinary financial statement and consolidated financial statement and in cases determined by law also interlocutory financial statement, decision on division of profit including any possible share for employees in the division of profit, decision on settlement of loss and determination of bonuses;
u) Approval of agreements set forth in Article 67a of the Commercial Code;
v) Decision on determining the deciding day for the origin of right to dividend payment;
w) Approval of a contract on control, contract on transfer of profit and contract on silent partnership, as well as changes to them;
x) Granting of agreement with entering into a contract, based on which the company is to acquire or alienate property, if such granting of agreement is required pursuant to Article 193 paragraph 2 of the Commercial Code;
y) Decision on other issues that the Commercial Code or this Articles of Association include in the competence of the general assembly.”
5. Amendment to Article 14 para. 10 of the Articles of Association
The current language of Article 14 para. 10 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “10. The general assembly is organizationally secured by the board of directors. If the more then one half of the members of the board of directors is missing, then the general assembly is organizationally secured by the body of the company that convened the general assembly.”
6. Amendment to Article 15 para. 9 (b) of the Articles of Association
In Article 15 para. 9 (b), the expression “Art. 27” shall be replaced with the expression “Art. 28”.
7. Amendment to Article 15 para. 9 (d) of the Articles of Association
The current language of Article 15 para. 9 (d) of the Articles of Association shall be amended by adding at its end the expression “according to Article 160 of the Commercial Code”.
8. Amendment to Article 15 para. 9 (f) of the Articles of Association
In Article 15 para. 9 (f), the expression “Clause 31a” shall be replaced with the expression “Clause 38l”.
9. Amendment to Article 15 para. 10 (e) of the Articles of Association
The current language of Article 15 para. 10 (e) of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “e) Approve a contract according to Article 12 para. 2 (u) of this Articles of Association.”
10. Amendment to Article 16 para. 4 (f) to (v) of the Articles of Association
Current language of Article 16 para. 4 (f) to (v) of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text:
“f) To perform resolutions of the general assembly;
g) To present matters that according to this Articles of Association are within the competence of the supervisory board to the supervisory board for discussion or for approval;
h) To decide in accordance with Article 28 paragraph 7 of this Articles of Association and authorisation by the general assembly on an increase in the company’s base capital;
i) To decide within the scope of rules approved by the general assembly on drawing on funds of the company made up from profit, without prejudice to Article 27 of this Articles of Association;
j) To grant and remove procuration;
k) To administer a list of owners of interim certificates;
l) To decide on refusing to give information requested by a shareholder at the general assembly under conditions determined in Article 180 paragraph 4 of the Commercial Code;
m) To name and discharge head employees of the company, without prejudice to Article 16 (4) n) of this Articles of Association;
n) Taking into account an opinion issued by the supervisory board, to appoint and recall Chief Executive Officer of the Company;
o) Taking into account an opinion issued by the supervisory board, to appoint and recall the auditor of the Company to verify financial statements or other documents whereof verification is required by law.”
11. Amendment to Article 16 para. 5 and Article 16 para. 6 of the Articles of Association
After Article 16.4 of the Articles of Association, a new Article 16.5 and a new Article 16.6 shall be inserted to read as follows: “5. The following acts are subject to the prior consent of the supervisory board:
a) To encumber, alienate or lease the Company’s assets if the accounting value of the respective assets under one contract or other interrelated contracts exceeds CZK 200.000.000;
b) To issue debentures except for those to which the consent of the general assembly is necessary for their issue;
c) To accept a loan (credit) or any other type of financial indebtedness exceeding, in each case, CZK 300.000.000;
d) To perform investments with financial expenses for one contract or other interrelated contracts exceeding CZK 300.000.000;
e) To provide any indemnification, guarantee or other security for any third party obligations, except for any indemnification, guarantee or other security for any obligations of the subsidiaries of the Company not exceeding CZK 150.000.000;
f) To decide on the sponsoring and donations exceeding CZK 1.000.000;
g) To set up and dissolve a foreign branch;
h) To conclude agreements establishing business companies and cooperatives, agreements creating interest groups, and on capital investment in business companies or cooperatives, on acquisition, encumbrance and alienation of participations in other business companies or cooperatives, without limitation to having their base office in the Czech republic;
i) To exercise voting rights at general assemblies of directly controlled subsidiaries of the company, i.e. those in which company directly holds at least 50% of the share capital and which, based on the latest available ordinary unconsolidated or, if created, consolidated financial statements, achieved at least the turnover exceeding CZK 15.000.000, in respect of the following matters (the “directly controlled companies”):
- electing, appointment of the statutory and supervisory bodies of the directly controlled companies and recalling of the supervisory bodies of the directly controlled companies;
- merger of the directly controlled company with another company and restructuring of the directly controlled company;
- changes to the Articles of Association or memorandum of association of the directly controlled company;
- distribution of the annual net profit acquired on the basis of ordinary unconsolidated financial statements of the directly controlled company;
- winding-up of the directly controlled company;
- sale of the business of the directly controlled company (or its part) to a third party and lease and/or pledge of the business of the directly controlled company (or its part) to a third party; and
- change of the legal form of the directly controlled company.
6. The Board of directors is, before deciding on them, obliged to obtain a prior opinion of the Supervisory board on the following:
a) Determination of a strategy and long-term business plan for the company, as well as annual and medium-term business plans for the company, including resources and means for ensuring and mechanisms for controlling of their fulfillment;
b) Any changes in the company’s organizational structure and the company’s organizational code on the first and second managerial levels below the board of directors, if any such changes must be urgently made, the opinion of the supervisory board may also be granted subsequently;
c) Recalling of the statutory bodies of the directly controlled companies, provided that if such changes must be urgently made, the opinion of the supervisory board may also be granted subsequently;
d) Approving and amending the rules of the board of directors;
e) Documents submitted by the board of directors to the general assembly; f) Proposals of the board of directors for increasing base capital by the board of directors according to Article 210 of the Commercial Code and Article 28 paragraph 7 of this Articles of Association;
g) Proposals of the manager agreements of the Chief Executive Officer or the members of the board of directors that are in the labor-law relationship to the company including determination of their consensual salaries; and
h) Use of the contingency fund according to Article 27 paragraph 5 of this Articles of Association.”
12. Change in numbering the current Article 16 para. 5 of the Articles of Association
The existing Article 16 para. 5 of the Articles of Association shall be newly numbered as Article 16 para. 7 of the Articles of Association.
13. Amendment to Article 17 para. 1 of the Articles of Association
In Article 17 para. 1 of the Articles of Association, the expression „five“ shall be replaced with the expression „seven“.
14. Amendment to Article 17 para. 2 of the Articles of Association
In Article 17 para. 2 of the Articles of Association, the expression „five-years’“ shall be replaced with the expression „three-years’“.
15. Amendment to Article 17 para. 5 of the Articles of Association
The existing Article 17 para. 5 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “5. The board of directors votes from among its members for a chairman and two vice-chairmen of the board of directors, who represent, each individually, the chairman of the board of directors to a full extent in performing his competence.”
16. Amendment to Article 19 para. 2 of the Articles of Association
The current language of Article 19 para. 2 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “2. The board of directors meets at least once every two weeks.”
17. Amendment to Article 19 para. 4 of the Articles of Association
The current language of Article 19 para. 4 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “4. If there is a written request by any member of the board of directors or by any member of the supervisory board, a meeting must be convened. Such a meeting must be convened within two weeks of the delivery of such a request and should be held not later than within three weeks from the day of delivery of such a request; reasons must be given for the request, and it must contain a proposal for the order of business.”
18. Amendment to Article 20 para. 3 (f) to (o) of the Articles of Association
The current language of Article 20 para. 3 (f) to (o) of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “f) To elect and discharge members of the board of directors, to confirm the election of members of the board of directors according to Article 38l paragraph 6 of the Commercial Code; g) To represent the company by means of its determined member in disputes against members of the board of directors in court proceedings and proceedings involving other authorities; h) To perform other activities within the competence that is entrusted to it by the Commercial Code or by this Articles of Association.”
19. Amendment to Article 20 para. 4 of the Articles of Association
The current language of Article 20 para. 4 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “4. The supervisory board shall give its prior consent or disapproval to the decisions of the board of directors according to Article 16 paragraph 5 of this Articles of Association.”
20. Insertion of a new Article 20 para. 5 of the Articles of Association
After Article 20 para. 4 of the Articles of Association, a new Article 20 para. 5 shall be inserted to read as follows: “5. Upon the request of the board of directors, the supervisory board shall provide the board of directors with its prior opinion in respect to the decisions according to Article 16 paragraph 4 letter n) and o) and Article 16 paragraph 6 of this Articles of Association.”
21. Change in numbering of the existing Articles 20 para. 5 and 20 para. 6 of the Articles of Association
The existing Articles 20 para. 5 and 20 para. 6 of the Articles of Association shall be newly numbered as Article 20 para. 6 and Article 20 para. 7, respectively.
22. Amendment to Article 21 para. 3 of the Articles of Association
In Article 21 para. 3 of the Articles of Association, the expression „five-years’“ shall be replaced with the expression „three-years’“.
23. Amendment to Article 21 para. 6 of the Articles of Association
The current language of Article 21 para. 6 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “6. The supervisory board elects from among its members a chairman and two vice-chairmen, who represents, each individually, the chairman of the supervisory board to his full extent in the performance of his competence.”
24. Amendment to Article 22 para. 2 of the Articles of Association
The current language of Article 22 para. 2 of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text: “2. The supervisory board meets when necessary, however, not less frequently than at least once every two months.”
25. Amendment to Article 22 para. 9 of the Articles of Association
Article 22 para. 9 of the Articles of Association shall be amended by replacing the current expression “Article 31a paragraph 5, or” shall be replaced with the expression „Article 38l.“
26. Insertion of a new Article 23 of the Articles of Association
After Article 22 of the Articles of Association, a new Article 23 shall be inserted to read as follows:
“Art. 23 Supervisory board Committees
1. The Supervisory board is obliged to establish the following committees:
a) the Staff and Remuneration Committee;
b) the Finance and Audit Committee;
c) the Corporate Governance Committee; and
d) the Strategy and Development Committee (the “Supervisory Board Committees“).
2. Each Supervisory Board Committee consists of 4 members.
3. Members of Supervisory Board Committees are appointed and recalled by the supervisory board at any time. The term of the office of a member of the Supervisory Board Committee is three years, unless the office of such member of the Supervisory Board Committee in the supervisory board terminates earlier; in this case the term of the office of the relevant member of the Supervisory Board Committee terminates as of this earlier date. Supervisory board Committees may consist only of members of the supervisory board.
4. Staff and Remuneration Committee The tasks of the Staff and Remuneration Committee include assistance in the achievement of the company’s strategic goals by presenting the supervisory board of opinions and conclusions regarding the management structure, organizational solutions, remuneration system and selection of staff appropriately qualified to build the company’s success. The Staff and Remuneration Committee’s tasks include in particular:
a) presenting recommendations to the supervisory board in relation to the personnel appointment and recall of the members of the board of directors;
b) periodic review and presentation of recommendations concerning the system of remuneration of the board of directors’ members and Chief Executive Officer including management contracts and incentive systems and submitting proposals to the supervisory board as to shaping such systems with a view to the implementation of the company’s strategic goals;
c) presenting to the supervisory board opinions concerning a substantiation of awarding remuneration pegged to the results, in the context of the assessment of the achievement of the company’s particular tasks and goals;
d) assessment of the human resources system in the company;
e) recommending candidates to a function of Chief Executive Officer;
f) keeping the supervisory board informed of any issues concerning the activities of the Staff and Remuneration Committee.
5. Finance and Audit Committee The Audit Committee advises the supervisory board on matters involving the correct implementation of principles on budget preparation, budgetary and financial reporting and the internal control of the company, as well as cooperation with the company’s auditor. The Committee’s tasks shall include in particular:
a) cooperation with the company’s auditors and submitting recommendations to the supervisory board on the appointment and remuneration of the company’s auditors;
b) review of the company’s financial statements;
c) discussing any issues or reservations that may relate to the analysis of the financial statements;
d) analysis of letters of the company’s auditor to the board of directors, the impartiality and objectiveness of the audit and the response of the board of directors;
e) control of the accounting system;
f) evaluation of the system of internal control of the company and the annual report;
g) annual review of the internal audit program, coordination of the activities of internal and external auditors, as well as examining the terms of conducting the internal audits;
h) cooperation with the company’s organizational units responsible for audit and control, as well as a periodic assessment of their activities and results;
i) considering all other issues connected with the audit of the company which were pointed out by the Committee or the Supervisory Board;
j) keeping the supervisory board informed of any issues concerning the activities of the Finance and Audit Committee.
6. Corporate Governance Committee The scope of the Corporate Governance Committee’s operations includes the preparation and presentation to the supervisory board of the opinions and recommendations regarding the Company’s organizational structure, position of the Company as the issuer of the securities listed on the stock exchange and the part of the international capital group. The tasks of the Corporate Governance Committee shall, in particular, include:
a) assessment of the implementation of the current corporate governance principles;
b) giving recommendations to the supervisory board regarding the implementation of corporate governance rules; c) opining normative documents concerning corporate governance principles;
d) if applicable, eventual assessment of reports on compliance with corporate governance rules prepared by the Prague Stock Exchange and/or Czech National Bank;
e) opining proposed changes to the company’s corporate documents and processing proposals of such changes for the supervisory board own documents;
f) monitoring the company’s management in terms of compliance with legal and regulatory requirements, including current corporate governance rules; and
g) keeping the supervisory board informed of any issues concerning the activities of the Corporate Governance Committee.
7. Strategy and Development Committee The Strategy and Development Committee’s task shall include opining and presenting recommendations to the supervisory board in matters involving Company’s strategy, opining of the strategic plan and contemplated investments and divestments that may have a material influence on the capital of the company. The Strategy and Development Committee’s tasks shall include in particular:
a) assessment of the impact of any projected and effected investments and divestments on the company’s assets;
b) assessment of actions, agreements, letters of intent and other documents connected with activities aimed at acquiring, selling, encumbering or otherwise disposing of the company’s material assets;
c) opining all strategic documents submitted to the supervisory board by the board of directors;
d) opining long-term strategic plans as well as annual technical and economic plans; and
e) keeping the supervisory board informed of any issues concerning the activities of the Strategy and Development Committee.
8. Each of the Supervisory Board Committees shall elect its chairman and vice-chairman, which shall represent the chairman in its absence.
9. The Supervisory Board Committees shall meet as they find it appropriate, but at least once every quarter.
10. The meeting of the Supervisory Board Committee shall be convened by the chairman of the committee, or the vice-chairman in his absence, or other appointed member of the committee.
11. Each of the Supervisory Board Committees shall be deemed to have a quorum if at least the simple majority of its members is present and all members of the committee were duly invited to the meeting.
12. To pass a resolution of each of the Supervisory Board Committees the consent of the majority of all of its members is required.
13. There shall be a record of each meeting of each of the Supervisory Board Committee, which shall be signed by the chairman or its vice-chairman or by any other appointed member of the committee. The opinions of the minority shall be recorded as well should the minority so require. The records must be archived for the time of the existence of the company.
14. The details on the form of the meeting of each of the Supervisory Board Committees and their powers shall be set out in the Code of Conduct of the Supervisory Board Committees approved by supervisory boars.”
27. Change in numbering the existing Articles 23 to 32 of the Articles of Association
The existing Articles 23 to 32 of the Articles of Association shall be newly numbered as Articles 24 to 33 of the Articles of Association.
28. Amendment to Article 26 para. 5 of the Articles of Association (newly numbered as Article 27 para. 5)
The current language of Article 26 para. 5 of the Articles of Association (newly identified as Article 27 para. 5) shall be deleted to the full extent thereof and replaced with the following text: “5. The board of directors decides on using the contingency fund. It does not include the obligatory part of the contingency fund on using of which decides the general assembly.”
29. Amendment to Article 31 para. 1 of the Articles of Association (newly identified as Article 32.1)
In Article 31.1 of the Articles of Association (newly identified as Article 32.1), the expression “Art. 27” shall be replaced with the expression “Art. 28”.
30. Amendment to Article 32 of the Articles of Association (newly identified as Article 33)
The current language of Article 32 of the Articles of Association (newly identified as Article 33) of the Articles of Association shall be deleted to the full extent thereof and replaced with the following text:
“Art. 33 Amendment to the Articles of Association
1. Changes to the Articles of Association become legitimate and come into effect at the instant when the general meeting decides on them, unless it arises from the decision of the general meeting on a change to the Articles of Association or from the law that the changes are to come into effect later.
2. These Articles of Association were accepted on 27.12.1994 and are valid according to amendments approved by decision of the general meeting from 20.12.1995, 27.6.1996, 24.3.1997, 27.3.1997, 15.7.1997, 29.5.1998, 29.1.1999, 19.8.1999, 29.6.2001, 17.1.2003 and 13.4. 2006.”