| The Board of Directors of ASTARTA Holding N.V. (the “Company") hereby informs about the Company’s partial non-compliance with the Code of Best Practice for WSE Listed Companies (“WSE Corporate Governance Rules"). At the beginning it should be underlined that the Company has decided to observe the majority of the WSE Corporate Governance Rules. However, certain principles apply to the Company accordingly, with due observance of Dutch corporate law and the Company's corporate structure, especially the single board structure as opposed to the two-tier system that the WSE Corporate Governance Rules assume. The Company does not have two separate governing bodies (supervisory board and management board) which are obligatory in Polish joint stock companies. Instead, the Board of Directors of the Company performs both the management and supervisory functions. As a result, the Company applies those principles of the WSE Corporate Governance Rules which refer to relations between supervisory board and management board not directly, but accordingly. In all cases, the Company endeavors to create procedures maintaining the spirit of all rules applied accordingly. Therefore, the Company is of an opinion that it complies with the principles of the WSE Corporate Governance Rules that refer to relations between supervisory board and management board or to the functioning of those bodies. The Company intends to comply with all the WSE Corporate Governance Rules, however one rule is observed only partially: Rule 6 of The Best Practice for Supervisory Board Members included in the WSE Corporate Governance Rules: At least two members of the Supervisory Board should meet the criteria of being independent from the company and entities with significant connections with the company. The independence criteria should be applied under Annex II to the Commission Recommendation of 15 February 2005 on the role of non-executive or supervisory directors of listed companies and on the committees of the (supervisory) board. Irrespective of the provisions of point (b) of the said Annex, a person who is an employee of the company or an associated company cannot be deemed to meet the independence criteria described in the Annex. In addition, a relationship with a shareholder precluding the independence of a member of the Supervisory Board as understood in this rule is an actual and significant relationship with any shareholder who has the right to exercise at least 5% of all votes at the General Meeting. There is only one governing body in the Company, the Board of Directors comprising both Executive and Non-Executive Directors, which fulfills the duties, respectively, both of a Polish-style management board and supervisory board. According to the Articles of Association (Article 12.3), at least half of the Non-Executive Directors have to be independent and if the Company has a shareholder holding shares carrying more than fifty per cent (50%) of all voting rights, then the Board of Directors should have at least two independent Non-Executive Directors. Pursuant to the Articles of Association such independent Non-Executive Director may therefore not be: a. an officer, employee or agent of the company; b. a director, officer, employee or agent of any affiliated company or enterprise; c. a shareholder holding more than one per cent (1%) of all voting right in the company; d. a director, officer, employee or agent of any shareholder holding more than one per cent (1%) of all voting right in the company. Currently there is one independent Non-Executive Director in the Board of Directors. The Company believes that due to its single board structure, it is not necessary to appoint more independent Non-Executives Directors. The present composition of the Board of Directors allows protecting properly interests of both minority and majority shareholders and ensures the transparency in functioning. However, if the Company considers that protection of shareholders’ interests is not sufficient, another independent member of the Board of Directors will be immediately appointed. Legal grounds: § 29 par. 3 of the Warsaw Stock Exchange Rules | |
