Changes in PKN ORLEN Statutes

The main element of the draft amendments is to make more precise the existing provisions of the Statutes concerning limited voting rights of the shareholders with the exception of the State Treasury, Nafta Polska and the foreign depositary, Bank of New York. They are supposed to protect the Company against accumulation of shareholders considered to be independent entities by implementing the provisions of Article 6 of the Polish Code of Commercial Companies into the Statutes.

The proposed amendments will make it possible to identify relations among respective shareholders being affiliated or subordinate entities. Such identification is based on principles which are legible and transparent both for the Company itself and its shareholders. Where it is suspected that there exist undisclosed relations between respective shareholders, the Company may request for explanation. If no explanation is given, the Company may treat the shareholders concerned as affiliated entities and limit their voting right to 10%. Thus, affiliated entities have a voting right corresponding to 10% of the capital, even if they have more shares. This provision does not apply to the State Treasury, Nafta Polska and the foreign depositary - Bank of New York.
Moreover, in the case shares are sold in the meantime between their registration for the General Meeting of Shareholders and the holding of the Meeting itself, the Company is entitled to be informed of such sale.

The aforementioned amendments are compliant with the Polish Code of Commercial Companies and refer to the laws on competition and consumer protection, the transparency of financial relations, accountancy and public offer.  
Moreover, according to the amended provisions, the Statutes would include a specific definition of a shareholder, compliant with the intention of the amendments to the Polish Code of Commercial Companies which will enter into force on 3 August this year. They assume that, even where a person holding the Company shares on the day of their registration for the General Meeting sells those shares after such registration, they still have their share right and the right to vote on the General Meeting.

A crucial part of the draft amendments are the proposed provisions concerning the appointment and dismissal of Members of the Supervisory Board. The changes are first of all supposed to maintain the current principle to the effect that the State Treasury is entitled to appoint one Member of the Supervisory Board without a decision from the General Meeting. Moreover, in order to strengthen the position of minority shareholders, the Management Board proposes to introduce a formula which would ensure them two to four seats in the Supervisory Board. Such procedure would ensure significant representation of minority shareholders in the Supervisory Board and their having a real impact on the Company's decisions.

The draft amendments also provide for changes in the Regulations of the General Meeting the purpose of which is to adjust the principles of convening the General Meeting to the generally applicable regulations. A novelty is the introduction of an e-platform for communication between the Company and its shareholders. Such tool would facilitate shareholder accessing materials presented by the Company, asking questions, submitting motions and proposing changes to meeting agendas and draft resolutions.