ARTICLES OF ASSOCIATION
OF JOINT STOCK COMPANY
I.
GENERAL PROVISIONS
§ 1 Company
The company operates under the name "NORTH COAST" joint-stock company. The
Company may use the abbreviated name "NORTH COAST" S.A. and its distinctive logo.
§ 2 Subject of activity
1.
The subject of activity of the Company includes:
(1) Wholesale and retail sale of vehicles, except of motorcycles (PKD 45.1);
(2) Wholesale and retail sale of motorcycles, their maintenance and repair, and wholesale
and retail sale of parts and accessories for them (PKD 45.4);
(3) Wholesale of food, beverages and tobacco (PKD 46.3);
(4) Wholesale of household goods (PKD 46.4);
(5) Wholesale of IT and communication tools (PKD 46.5);
(6) Wholesale of machinery, equipment and supplementary hardware (PKD 46.6);
(7) Other specialized wholesale (PKD 46.7);
(8) Non-specialized wholesale (PKD 46.9);
(9) Retail sale in non-specialized stores (PKD 47.1);
(10) Retail sale of food, beverages and tobacco in specialized stores (PKD 47.2);
(11) Retail sale of other household articles in specialized stores (PKD 47.5);
(12) Retail sale of other goods in specialized stores (PKD 47.7);
(13) Road transport of goods and service activities related to removal services (PKD 49.4);
(14) Restaurants and other catering establishments (PKD 56.1);
(15) Preparing food for external recipients (catering) and other gastronomic service
activities (PKD 56.2);
(16) Preparing and serving beverages (PKD 56.3);
(17) Accounting and bookkeeping activities; tax consultancy (PKD 69.2);
(18) Renting and leasing of other machinery, equipment and tangible goods (PKD 77.3).
2.
Starting activity for which the license or permit is required is subject to their obtaining by
the Company.
§ 3 Duration of the Company
The Company's duration is unlimited.
§ 4 Company's registered office
The Company's registered office is in Pruszkow.
§ 5 Company's area of activity
1.
The Company may operate on the territory of Republic of Poland and abroad.
2.
In the area of its operation, the Company may establish branches and other
organizational units, establish companies and acquire shares in other companies in
Poland and abroad.
II.
SHARE CAPITAL
§ 6 Share capital and shares
1.
The share capital of the Company amounts to PLN 640,000 (in words: six hundred forty
thousand).
2.
The Company's share capital is divided into 3,200,000 (in words: three million two
hundred thousand) shares, including:
(i) 1,000,000 (in words: one million) registered preference shares of A series with a
nominal value of 0.2 zł (say: twenty grosz) each share numbered from 00000001 to
1000000; and
(Ii) 1,500,000 (in words: one million five hundred thousand) bearer shares of B series
with a nominal value of 0.2 zł ; and
(iii) 700,000 (in words: seven hundred thousand) bearer shares of C series with a
nominal value of 0.2 zł.
3.
The share capital was covered by the assets of the company being transformed, i.e.
NORTH COAST company with limited liability pursuant to art. 551 § 1 of the
Commercial Companies Code.
4.
A series shares are preference shares in such a way that each share carries two votes
at the General Meeting of Shareholders.
5.
The Company's shares may be redeemed with shareholder's consent through their
acquisition by the Company. Conditions and procedure for redemption of shares are
determined by the General Assembly of Shareholders.
6.
The Company may issue bonds, including convertible bonds, pre-emptive bonds and
warrants.
7.
Bearer shares are not convertible into registered shares. The decision regarding the
conversion of registered shares into bearer shares is made by the Management Board
of the Company at the request of the shareholder.
8.
Disposal and pledging of A series shares requires the approval of the Company issued
in writing by the Management Board.
9.
The pledgee or user of registered shares cannot exercise voting rights on
the General Meeting of Shareholders.
§ 7 Disposal of the Company's profit
1. The Shareholders are entitled to share in the profit disclosed in the financial statement,
audited by the auditor, which has been designated by the General Meeting of
Shareholders for payment.
2. The profit is distributed in proportion to the number of shares.
3.
Those entitled to dividend for a given financial year are those shareholders who owned
shares on the date of adoption of the resolution on profit distribution. The General
Meeting of Shareholders may determine the date, on which the list of shareholders
entitled to dividend for the financial year (dividend report date) is fixed. The dividend
report date may not be
set later than within two months from the date of the adoption of resolution concerning
the appropriation of the profit for distribution to shareholders.
III. GOVERNING BODIES OF THE COMPANY
§8
The Company's governing bodies are the General Meeting of Shareholders, the Supervisory
Board and the Management Board.
§ 9 General Meeting of Shareholders
1.
The General Meeting of Shareholders may be ordinary or extraordinary.
2.
The General Meeting of Shareholders will be held at the registered office of the Company
or in Warsaw.
3.
The General Meeting of Shareholders is convened through the announcement.
4.
The Ordinary General Meeting of Shareholders is held within six months after the end
of financial year.
5.
The principles of functioning of the General Meeting of Shareholders are determined by
the regulations adopted by the General Meeting of Shareholders
§ 10 Resolutions of the General Meeting of Shareholders
1.
The resolutions of the General Meeting of Shareholders are adopted by an absolute
majority of votes cast, unless the provisions of law or the Articles of Association lay
down more strict conditions for adopting resolutions.
2.
The following matters require a resolution of the General Meeting of Shareholders:
(i) considering and approving the Management Board's Report and the financial
statement for the previous financial year and granting discharge from the fulfilment
of duties to members of the governing bodies of the Company.
(ii) making decisions on damages caused while establishing the Company or in
connection with the Board conducting activities;
(iii) selling and leasing the enterprise or its organized part and establishment of a limited
property right;
(iv) forming equity in the Company and making decisions about its use;
(v) adopting resolutions on distribution of profit and coverage of losses;
(vi) approval of the Company's long-term strategic plans;
(vii) increasing and decreasing the share capital of the Company;
(viii) determining the conditions and procedure for redemption of shares;
(ix) determining the remuneration of members of the Supervisory Board;
(x) dissolution or liquidation of the Company;
(xi) appointing and dismissing members of the Supervisory Board, subject to § 11 sec. 3
and 4 of the Articles of Association;
(xii) appointing and dismissing members of the Management Board;
(xiii) amending the Company's Articles of Association;
(xiv) approving the Rules of the Supervisory Board;
(xv) making decisions on other matters which, in accordance with the provisions of the
Commercial Companies Code and other provisions of law and the provisions of this
Articles of Association fall within the exclusive competence of the General Meeting of
Shareholders.
(xvi) issuing of convertible bonds, bonds with pre-emptive rights, subscription warrants.
3.
Acquisition and disposal of real property, perpetual usufruct right or interests in real
estate does not require the approval of the General Meeting of Shareholders.
§ 11 The Supervisory Board
1.
The Supervisory Board consists of five (5) to seven (7) members, appointed and
dismissed by the General Meeting of Shareholders.
2.
The Supervisory Board members are appointed for a three-year joint term of office.
3.
The Supervisory Board members may be reappointed for another term.
§ 12 Adoption of resolutions by the Supervisory Board
1.
The Supervisory Board takes decisions in the form of resolutions at the meetings
convened by the Chairman of the Supervisory Board or, if it is not possible to convene
the meeting by the Chairman, the Vice Chairman of the Supervisory Board. The
Chairman of the Supervisory Board convenes a meeting of the Supervisory Board on his
own initiative or within two weeks of receipt of the request of the Management Board or
Supervisory Board member. The request referred to in previous sentence should be
submitted in writing with indication of the proposed agenda.
2.
The Supervisory Board meetings may be attended by the members of the Management
Board, with the exception of meetings related directly to the members of the
Management Board, in particular their dismissal, responsibility, and determining
remuneration.
3.
The Supervisory Board meetings shall be held as necessary but not less frequently than
once a quarter.
4.
The Supervisory Board resolutions may be adopted if the meeting is attended by at least
half of its members and all the members have been invited at least 7 working days prior
to the planned meeting. The resolutions of the Supervisory Board shall be valid also
when its member notified within a period shorter than the term referred to in the
preceding sentence, declares in writing that he agrees to the adoption of the resolution
of the Supervisory Board.
5.
The Supervisory Board Members may participate in adopting of Supervisory Board
resolutions by casting their votes in writing through another member of the Supervisory
Board.
6.
The Supervisory Board may adopt resolutions without meeting by voting in writing or
using means of direct remote communication, provided that all members have been
informed about the content of the draft resolution. The voting as described in the
preceding sentence may be ordered the Chairman of the Supervisory Board at his own
initiative or at the request of a member of Supervisory Board or Management Board.
7.
Adoption of resolutions in the mode referred to in sec. 5 and 6 shall not apply to the
election
Election of the Chairman and Vice Chairman of the Supervisory Board nor the
suspension of the members of the Board.
8.
The resolutions of the Supervisory Board are adopted by an absolute majority of votes.
In case of equality of votes, the vote of the Chairman of the Supervisory Board decides.
§ 13 Powers of the Board
1.
The Supervisory Board exercises an ongoing supervision over the Company's activities.
2.
The special powers of the Supervisory Board include:
(i) assessing the Company's financial statements and Management Board's reports as
well as Management Board's proposals regarding distribution of profit or covering of
loss and submitting an annual written report on the results of this assessment;
(ii) representing the Company in agreements and disputes with the members of the
Management Board;
(iii) suspending, for important reasons, individual members of the Management Board
and delegating Supervisory Board members to temporarily perform the duties of
members of the Management Board who are unable to perform their duties;
(iv) approving the Management Board Regulations;
(v) granting consent to disburse to shareholders an advance on account of
the expected dividend;
(vi) appointing and changing the auditors of the financial statements of the Company;
3.
The Supervisory Board adopts regulations specifying its organization and the way it
performs its duties, which is subject to the approval by the General Meeting of
Shareholders.
§ 14 Management Board
1. The Management Board consists of 1 (one) to 5 (five) persons appointed by the resolution
of the General Meeting of Shareholders for the joint term of three years of office, including
the Chairman.
2. The Management Board Members may be appointed for next terms of office.
3. The following are authorised to represent the Company: The Chairman of the
Management Board individually or a member of the Management Board interacting with
the Chairman of the Management Board.
4. Detailed principles of functioning of the Management Board shall be set out in the
regulations of the Management Board adopted by the Management Board and approved
by the Supervisory Board.
§ 15
The Management Board is entitled to pay out to shareholders an advance on account of
the expected dividends, subject to § 13 sec. 2 point (v) of Articles of Association.
IV
FINAL PROVISIONS
§ 16 Supplementary capital and other capitals
1.
The Company creates supplementary capital, to which 8% of the profit for the financial
year in question is added, until that capital reaches 1/3 of the share capital of the
Company.
2.
The General Meeting of Shareholders may form other capitals.
§ 17 The Company's financial year
The financial year is the calendar year.
§ 18 Announcements
Announcements required by law coming from the Company are published in the Court
and Commercial Monitor.
§ 19 Dissolution of the Company
1.
1.
The Company may be dissolved at any time by the resolution of the General Meeting of
shareholders and for other reasons provided by law.
2.
The Company is dissolved through liquidation. The liquidation is carried out under the
Company's name with the addition "in liquidation". The liquidators are the members of
the Management Board, unless the General Meeting of Shareholders appoints another
liquidator.