Article 20
- The Management Board shall manage the Company's affairs and shall represent the Company in and out of court.
- The powers and responsibilities of the Management Board shall include all the matters connected with managing the Company’s affairs other than those which fall within the exclusive scope of competence of the General Meeting or the Supervisory Board under applicable laws or these Articles of Association.
- The Management Board shall be headed by the President of the Management Board.
Article 21
- Declarations of will may be made on behalf of the Company by two Management Board members acting jointly or one Management Board member acting jointly with a commercial proxy.
- Appointment of a commercial proxy shall require a unanimous resolution of all members of the Management Board. The powers of proxy granted to a commercial proxy may be revoked by any member of the Management Board.
- The Management Board shall be the manager of an organisational unit as defined in the special regulations.
- Acts in law falling within the scope of responsibility of the manager of an organisational unit under the special regulations shall be performed by the member of the Management Board specified in the Resolution referred to in Article 22.2.5 acting individually.
- The Management Board may appoint proxies.
- The manner of operation of the Management Board shall be defined in detail in the rules of procedure adopted by the Management Board and approved by the Supervisory Board. In justified cases, votes may be cast by written ballot or by using means of remote communication, with the minutes of such voting to be approved at the next meeting of the Management Board.
Article 22
- Any issues which fall beyond the scope of the day-to-day management of the Company’s affairs shall require a resolution of the Management Board.
- A resolution of the Management Board shall be required in particular for:
- adoption of the rules of procedure for the Management Board;
- adoption of the Company’s organisational rules;
- formation and liquidation of branches;
- appointment of a commercial proxy;
- division of authority between the Management Board members, provided, however, that a relevant resolution of the Management Board must be approved by the Supervisory Board pursuant to Article 33.1.11;
- contracting and granting loans and contracting credit facilities, subject to Article 33.2.3 and 33.3.16;
- adoption of annual business plans, including investment plans, subject to Article 33.1.6;
approval of the strategy for the Company and the PGNiG Group and long-term strategic plans, subject to Article 33.1.6a;
- assumption of contingent liabilities, including issuance by the Company of guarantees and sureties, as well as issuance of promissory notes, subject to Article 33.2.3 and 33.3.16;
- acquisition or disposal of non-current assets, including real property, perpetual usufruct right to real property or interest in real property, with a value equal to or higher than the złoty equivalent of EUR 50,000, subject to Article 33.2.1, 33.2.2, and Article 56.3.2 and 56.3.3;
- issues to be considered by the Supervisory Board or the General Meeting upon the Management Board’s request;
- adoption of the reports referred to in Article 23.2;
- establishment of another company, subscription for, acquisition or disposal of shares in another company, including definition of the terms and procedure for such disposal, subject to Article 33.3.8 and Article 56.6;
- the decision to distribute interim dividend as referred to in Art. 22 c.1.
Article 22a
1. Any disposal of non-current assets as defined in the Accounting Act of September 29th 1994, with a value exceeding 0.1% of total assets as disclosed in the most recent approved financial statements, shall be made by the Company through an auction, unless the value of the assets to be disposed of is equal to or lower than PLN 20,000.
2. The Company may sell non-current assets outside of an auction if:
1) the agreement provides for the sale of financial instruments, shares or other non-current financial assets, licences, patents or other industrial property rights or know-how, provided that the terms of sale and a sale procedure other than a public auction are defined in a resolution of the Supervisory Board;
2) the sale is effected as part of liquidation proceedings, on terms specified in a resolution of the General Meeting, or as part of bankruptcy or reorganisation proceedings subject to separate regulations,
3) the assets for disposal are residential units owned by the Company, and they are sold for a price equal to or higher than 50% of their market value to the tenant or a person permanently cohabiting with the tenant within the meaning of Art. 4.13 of the Property Management Act of August 21st 1997; the price calculations must take into account that the residential units for sale are occupied; the value of tenant improvements shall be included in the purchase price,
4) the assets are sold to a subsidiary,
5) the assets for disposal are commodities within the meaning of the laws on commodity exchanges, other than things specified according to their type, in particular property rights arising from the certificates referred to in the Energy Law, certificates of origin or certificates of origin for energy generated from agricultural biogas, energy efficiency certificates, as well as CO2 emission allowances and their equivalents,
6) the disposal of assets could entail disclosure of classified information relating to critical infrastructure,
7) in other justified cases at the Management Board’s reasonable request - on terms determined by a resolution of the Supervisory Board, and if the assets are sold - for a price determined by a resolution of the Supervisory Board.
Article 22b
Non-current assets shall be disposed of according to the following procedure:
1. An auction shall be announced in the Public Information Bulletin on the Energy Ministry’s website, on the Company’s website, in a public area within the Company’s registered office where such announcement will be clearly visible, and in other places customarily used for posting announcements.
2. The auction may not be held earlier than 14 days after its announcement.
3. The following persons may not participate in the auction as bidders:
1) members of the Company’s Management and Supervisory Boards;
2) the business entity conducting the auction and members of its management and supervisory boards;
3) persons responsible for handling the auction process;
4) spouses, children, parents and siblings of the persons referred to in items 1−3, and
5) persons whose legal or factual relationship with the entity conducting the auction may raise reasonable doubts as to its impartiality.
4. As a condition for participating in the auction, bidders must pay a bid bond equal to 5% or more of the asking price for the non-current asset offered for sale. The rules referred to in Art. 22b.8 may provide for a higher amount of the bid bond.
5. Prior to the auction, the Company shall set the asking price, which may not be lower than the market price established by expert appraisers; if the market value cannot be established, the price of the asset may not be lower than its net carrying amount.
6. The Company may elect not to have a non-current asset intended for sale valued by an expert appraiser if:
1) the appraisal costs would clearly exceed the asset’s market value;
2) the asset’s market value has already been established.
7. The auction shall be conducted by:
1) oral bidding;
2) written bidding.
8. Rules defining the terms and procedures for conducting the auction, the text of the announcement, the bidding method, and the auction terms shall be defined by the Company.
9. The auction organiser may close the auction without selecting a winning bid and without specifying the reason.
10. The bidder who offers the highest price shall win the auction
Article 22c
- The Management Board shall be authorised to distribute interim dividend provided that the Company has sufficient funds to do so. Payment of interim dividend shall require approval by the Supervisory Board, as referred to in Art. 33.2.10.
- The Company may pay interim dividend referred to in Art. 22 c.1 if its approved financial statements for the previous financial year show a profit. Interim dividend may not exceed half of the profit earned since the end of the previous financial year, as disclosed in the audited financial statements, increased by the amount of capital reserves created from profit which may be used by the Management Board to pay out interim dividend, and reduced by the amount of any accumulated losses and treasury shares.
- The Management Board shall announce its intention to pay interim dividend at least four weeks before payments begin, specifying the date as at which the financial statements were prepared, the amount to be paid out and the date as at which the right to interim dividend is determined (the interim dividend record date). The interim dividend record date should fall within seven days before the date when payments begin.
Article 23
- The Management Board shall prepare the plans referred to in Article 22.2.7 and submit them for approval by the Supervisory Board.
- The Management Board shall submit, upon each request, to the minister competent for matters pertaining to the State Treasury and the minister competent for the economy, detailed reports on the performance of the activities undertaken with a view to ensuring the energy security of Poland;
2a. The Management Board shall submit to the minister competent for matters pertaining to the State Treasury, within two months from the closing of the General Meeting which approved the financial statements and the Directors’ Reports of the Company’s subsidiary and related companies, annual reports concerning the matters listed below, along with an assessment of information contained therein in the context of the energy security of Poland:
1) implementation of a strategic investment project or involvement in investment projects that result in a lasting or temporary deterioration of the economic efficiency of the operations of that subsidiary or related company, but that are required for ensuring the energy security of Poland,
2) entering by the operator or the owner of a distribution system or an interconnection gas pipeline into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a transmission network, distribution network, interconnection gas pipeline or a direct gas pipeline, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
3) entering by the operator or the owner of a storage facility into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a storage facility, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
4) entering by the owner of a generation unit or a cogeneration unit into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a generation unit or a cogeneration unit, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
5) entering into an obligational relationship with a foreign entity in relation to or in connection with hydrocarbon exploration, appraisal or production, within the meaning of the Polish Geological and Mining Law, if the value of the obligational relationship exceeds the PLN equivalent of EUR 5,000,000,
- with the proviso that items 1–5 above shall not apply to information concerning credit agreements, maintenance services, including overhauls, geophysical, drilling and well services and projects, as well as services or deliveries relating to such agreements or projects.
- item 5 shall neither apply to information concerning the activities of a foreign subsidiary pertaining to contracts and agreements concluded as part of day-to-day management of the organisational structure, including employment contracts, use of assets where the related liabilities are equal to or less than EUR 5,000,000, and day-to-day administrative expenses.
2b. The Company’s Management Board shall submit relevant information to the minister competent for matters pertaining to the State Treasury, within 21 days from the closing of the General Meeting of a subsidiary or related company which addressed the following matters:
1) a strategic investment project or involvement in investment projects that result in a lasting or temporary deterioration of the economic efficiency of the operations of that subsidiary or related company, but that are required for ensuring the energy security of Poland,
2) entering by the operator or the owner of a distribution system or an interconnection gas pipeline into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a transmission network, distribution network, interconnection gas pipeline or a direct gas pipeline, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
3) entering by the operator or the owner of a storage facility into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a storage facility, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
4) entering by the owner of a generation unit or a cogeneration unit into an obligational relationship with a foreign entity in relation to or in connection with the planning, analysis, construction, expansion or disposal of a generation unit or a cogeneration unit, within the meaning of the Polish Energy Law, if the obligational relationship is related to infrastructure with a present value or – in the case of new infrastructure or infrastructure being planned – with an estimated value exceeding the PLN equivalent of EUR 500,000,
5) entering into an obligational relationship with a foreign entity in relation to or in connection with hydrocarbon exploration, appraisal or production, within the meaning of the Polish Geological and Mining Law, if the value of the obligational relationship exceeds the PLN equivalent of EUR 5,000,000.
6) approving annual budgets, detailed information concerning resolutions adopted by the General Meeting of the subsidiary or related company in the scope of matters specified in items 1–6 together with an assessment of their implications for the country's energy security,
- the above shall not apply to information concerning credit agreements, maintenance services, including overhauls, geophysical, drilling and well services and projects, as well as services or deliveries relating to such agreements or projects.
Item 5 shall neither apply to information concerning the activities of a foreign subsidiary pertaining to contracts and agreements concluded as part of day-to-day management of the organisational structure, including employment contracts, use of assets where the related liabilities are equal to or less than EUR 5,000,000, and day-to-day administrative expenses.
- The Management Board shall prepare or procure the preparation of quarterly economic and financial reviews of the Company and its subsidiaries acting as distribution or storage system operators, in the form defined by the minister competent for matters pertaining to the State Treasury, and shall submit or procure the submission of the reviews to the minister competent for matters pertaining to the State Treasury and the minister competent for the economy by the end of the month in which a periodic report was published at the Warsaw Stock Exchange.
- The Management Board shall submit to the General Meeting a report on entertainment expenses, legal costs, marketing costs, public relations and social communication expenses, and costs of management advisory services, along with the Supervisory Board’s opinion.
Article 24
- The Management Board shall have from two to seven members. The number of Management Board members shall be determined by the body appointing the Management Board.
- Management Board members shall be appointed for a joint term of three years.
- The Management Board shall meet requirements of the Act on State Property Management of December 16th 2016.
- 1) A Management Board candidate shall meet all of the following criteria:
a) have a university degree obtained in Poland or a university degree obtained abroad and recognized in Poland under separate laws,
b) have at least five years of employment under a contract of employment, election or appointment, an employment contract for cooperative members, other agreement for the provision of services, or as a business owner/sole trader,
c) have at least three years of experience serving in managerial or independent positions or as a business owner/sole trader,
d) meet other applicable legal requirements than specified in items a-c, specified in separate laws, including in particular not being subject to any legal limitations or bans on serving on the management board of a commercial-law company;
2) A Management Board candidate may not be a person who meets at least one of the following criteria:
a) performs the function of a social partner or works at the office of a member of the Polish Parliament (Sejm or Senate) or of a member of the European Parliament under an employment, temporary employment or similar contract,
b) is a member of a political party's body representing the party before third parties and authorised to assume obligations,
c) works for a political party under an employment, temporary employment or similar contract,
d) holds an elected position in a trade union operating at the Company or any Group company,
e) their social or professional activities give rise to a conflict with the interests of the Company.
Article 25
- Individual members of the Management Board or the Management Board as a whole shall be appointed and removed by the Supervisory Board.
- A member of the Management Board shall be appointed following a qualification procedure carried out pursuant to the Regulation of the Polish Council of Ministers concerning qualification procedures for members of management boards of certain commercial-law companies of March 18th 2003 (Dz.U. No. 55, item 476, as amended). The Regulation shall not apply to Management Board members elected by employees.
- A member of the Management Board may resign from his/her position by delivering a representation to that effect to the Supervisory Board, with a copy to the State Treasury as a Company shareholder, represented by the minister competent for matters pertaining to the State Treasury. To be valid, the resignation shall be submitted in a written form, or otherwise shall be ineffective towards the Company. The provisions of the Civil Code governing termination of a mandate by the party accepting the mandate shall apply accordingly to the resignation.
Article 26
- As long as the State Treasury remains a shareholder of the Company and the Company’s average annualised headcount exceeds 500, the Supervisory Board shall appoint one person elected by the Company's employees to serve on the Management Board during its term.
- The candidate for the position of the Management Board member elected by the Company's employees shall be a person who has received no less than 50% plus 1 of votes validly cast in the election. The result of the voting shall be binding on the Supervisory Board, provided that at least 50% of all employees take part in the voting.
- [deleted]
- The voting shall be held by secret ballot and shall have the form of a general and direct election; the election shall be administered by Election Committees appointed by the Supervisory Board from among the Company's employees. A candidate for the election may not be a member of an Election Committee.
5. The employees' failure to elect a Management Board member shall not preclude adoption of valid resolutions by the Management Board.
6. The Management Board shall provide the necessary assistance to hold the election.
7. The Supervisory Board shall adopt detailed rules governing election and removal of the Management Board member elected by the Company's employees, and the rules of by-elections, in accordance with the above provisions.
8. Election of the candidate for the position of the Management Board member elected by the Company's employees shall be ordered by the Supervisory Board, subject to the provisions of Article 27.
9. The election and removal of the Management Board member elected by the Company's employees and by-elections shall be governed by the following rules and procedure:
- The election shall be organised and administered by the Election Committee. If the Company has a multi-plant structure, the election shall be organised and administered by the Central Election Committee, supported by Divisional Election Committees.
- The Election Committees shall be responsible for efficient administration of the election in accordance with applicable laws, these Articles of Association and the rules of procedure for the Election Committees.
- The Central Election Committee's responsibilities shall include, without limitation:
- preparing and announcing the rules of procedure for the Election Committees;
- compiling the list of election divisions and drafting the election schedule;
- checking and registering lists of voters and determining the number of employees holding the right to vote as at the voting date;
- ongoing monitoring of the course of the election, in particular election divisions and of the activities of the Divisional Election Committees; considering complaints concerning administration of the election;
- registering the candidates and announcing the list of the candidates;
- preparing ballot papers and ballot-boxes;
- overseeing the course of the voting, counting the votes, drafting the final report, and determining and announcing the election results;
- supervising strict adherence to the provisions of these Articles of Association applicable to the election as well as their interpretation in the event of disputes;
- establishing the official design of the special election seal;
- The Divisional Election Committees' responsibilities shall include, without limitation:
- checking the lists of voters in a given election division and determining the number of employees holding the right to vote in the division as at the voting date;
- administering the voting and delivering the ballot-boxes containing ballot papers to the Central Election Committee;
- cooperating with the Central Election Committee, in particular in counting the votes cast.
- The right to stand for election shall accrue to the person nominated in accordance with Article 26.9.6 and 26.9.7.
- Each trade union active at the Company and each group of at least 50 employees shall have the right to nominate a candidate for the election. An employee may endorse only one candidate.
- Nominations shall be submitted in writing to the Central Election Committee no later than 14 days prior to the scheduled voting date.
- If no candidate is elected in accordance with Article 26.2, the second round of the election shall be held to vote on the two candidates who have received the largest number of votes during the first round.
- The second round of the election shall be administered in accordance with the procedure prescribed for the first round, subject to modifications resulting from Article 27.9.8.
- After the final results of the election are determined, the Central Election Committee shall declare the election to have been validly held, and then shall make the relevant announcement and provide the election documentation to the Supervisory Board.
- A request to remove the Management Board member elected by the Company's employees shall be submitted to the Management Board, which shall forward it promptly to the Supervisory Board.
- Voting on removal of the Management Board member elected by the Company's employees shall be held in accordance with the procedure prescribed for appointing such members, subject to Article 28.
Article 27
- Election of a candidate for the position of the Management Board member elected by the Company’s employees for the next term of office shall be ordered by the Supervisory Board no later than three months before the end of the current term of office; the Supervisory Board shall determine the time when the election is to be held.
- A by-election shall be held in the event of removal, resignation or death of the Management Board member elected by the Company’s employees.
- By-elections and voting on the removal of the Management Board member elected by the Company’s employees shall be ordered by the Supervisory Board within one month from the date on which the Supervisory Board becomes aware of an event necessitating the by-election or voting. Such by-election or voting should be held within two months from the date on which it is ordered by the Supervisory Board.
- By-elections shall be governed by the provisions of Article 26.
- By-elections shall be governed by the provisions of Article 26
Article 28
Upon written request by at least 15% of the total number of the Company's employees, the Supervisory Board shall order voting on the removal of the Management Board member elected by the Company's employees. The result of the voting shall be binding on the Supervisory Board, provided that at least 50% of all employees take part in the voting and the same majority of votes is obtained as is required when voting on the election of the Management Board member elected by the Company's employees.
Article 29
[Deleted]
Article 30
The Supervisory Board shall determine the remuneration of and other terms of contract with Management Board members, including the President, taking into account the powers of the General Meeting under the mandatory provisions of law.
Article 31
- The Company shall be the employer as defined by Labour Law.
- Any acts falling within the scope of labour law shall be performed by the Management Board member specified in the resolution referred to in Article 22.2.5, subject to Article 45.