Foundation Agreement

This Foundation Agreement is entered into between:

(1)        Spoločnosť pre skladovanie, a. s., a company incorporated under the laws of the Slovak Republic, having its registered office at 461, 919 33 Trakovice, Slovak Republic, Company Ident. No. (IČO): 47 400 781, registered at the Companies Register of the District Court Trnava, Section: Sa, File No.: 10607/T (hereinafter referred to as “Founder 1”),

(2)        Bennet Oil s.r.o., a company incorporated and existing under the laws of the Slovak Republic, having its registered office at Dvořákovo nábrežie 8, 811 02 Bratislava, Slovak Republic, Company Ident. No. (IČO): 36 707 279, registered at the Companies Register of the District Court Bratislava I, Section: Sro, File No.: 43431/B (hereinafter referred to as “Founder 2”),

(3)        OMV Slovensko, s.r.o., a company incorporated and existing under the laws of the Slovak Republic, having its registered office at Einsteinova 25, 851 01 Bratislava, Slovak Republic, Company Ident. No. (IČO): 00 604 381, registered at the Companies Register of the District Court Bratislava I, Section: Sro, File No.: 777/B (hereinafter referred to as “Founder 3”),

(4)        PROGRESS TRADING, a.s., a company incorporated and existing under the laws of the Slovak Republic, having its registered office at Cukrovarská 22, 075 01 Trebišov, Slovak Republic, Company Ident. No. (IČO): 31 679 765, registered at the Companies Register of the District Court Košice I, Section: Sa, File No.: 1333/V (hereinafter referred to as “Founder 4”),

(5)        SLOVNAFT, a.s., a company incorporated and existing under the laws of the Slovak Republic, having its registered office at Vlčie hrdlo 1, 824 12 Bratislava, Slovak Republic, Company Ident. No. (IČO): 31 322 832, registered at the Companies Register of the District Court Bratislava I, Section: Sa, File No.: 426/B (hereinafter referred to as “Founder 5”).

The Founder 1, the Founder 2, the Founder 3, the Founder 4 and the Founder 5 hereinafter referred to collectively as “Parties” and each individually as “Party”.

Whereas:

(A)         The Founder 1 is an entity entitled to found - as one of the Founders - the Emergency Oil Stocks Agency in accordance with Section 15(1) of Act No. 218/2013 Coll. on emergency stocks of oil and petroleum products and on dealing with state of oil emergency, amending certain acts (hereinafter referred to as “Act”).

(B)         The Founder 2, the Founder 3, the Founder 4 and the Founder 5 meet the conditions placed by the Act on a selected entrepreneur who expressed an interest in founding the Emergency Oil Stocks Agency.

(C)         The Parties intend to jointly found the Emergency Oil Stocks Agency in the form of an interest association of legal entities in accordance with Sections 20f to 20j of the Civil Code.

The Parties have agreed as follows:

1                   Purpose

1.1         The Parties found hereby an interest association of legal entities, whose purpose shall be to procure and handle emergency stocks to be used in state of oil emergency or to meet international obligations binding upon the Slovak Republic.

2                   Name and Registered Office

2.1         The name of the interest association of legal entities is: “Agentúra pre núdzové zásoby ropy a ropných výrobkov” (hereinafter referred to as “Agency”).

2.2         The translation of the interest association of legal entities into English is: Emergency Oil Stocks Agency.

2.3         Abbreviated name of the Agency is: EOSA.

2.4         The Agency’s registered office is at Trnavská cesta 100, 821 01 Bratislava-Ružinov, Slovak republic.

3                   Scope of Activity

3.1         The scope of activity of the Agency is:

(i)           procurement and maintenance of emergency stocks,

(ii)          storage of emergency stocks,

(iii)         handling of emergency stocks, and

(iv)         release of emergency stocks.

3.2         The founder members of the Agency agree with the scope of activity of the Agency.

3.3         The Agency shall perform the activities specified in 3.1 in accordance with the Act.

1.             The Agency shall procure emergency stocks for selected entrepreneurs in accordance with the Act to the extent corresponding to the minimum emergency stocks limit in total, as specified by the Administration of the State Material Reserves of the Slovak Republic (hereinafter referred to as “Reserve Administration”) in accordance with the Act. The price for the service of procuring and maintenance of emergency stocks shall be funded by the Agency from the remuneration paid by selected entrepreneurs on the basis of the Contract on procuring the maintenance of emergency stocks and from external funding. The price for the service of procuring the maintenance of emergency stocks shall cover the costs of procurement, insurance, storage, protection and other assurance of the quality parameters of emergency stocks, the costs of Agency funding, the costs related to the establishment of Agency and the administrative costs of the Agency.

4                   Adoption of the Articles of Association

4.1         The Parties, as the founding members of the Agency, shall adopt the Articles of Association of the Agency. The adopted wording of the Articles of Association of the Agency forms Annex No. 1 hereto. The Articles of Association shall regulate the Agency’s internal organization, legal and property situation, economic management, manner of winding up, and disposal of its liquidation balance. The Articles of Association shall be binding upon each member of the Agency. The Articles of Association may only be amended under the conditions and in the manner laid down in the Articles of Association of the Agency.

5                   Membership

5.1         The Parties are the founding members of the Agency.

5.2         Any selected entrepreneur who is obliged to ensure the maintenance of emergency stocks in accordance with Section 3 of the Act may become a member of the Agency.

5.3         The commencement and termination of the membership in the Agency and the rights and obligations of the members of the Agency shall be regulated in the Articles of Association of the Agency.

6            Bodies and Acting on behalf of the Agency

6.1         The Agency shall create the following bodies:

(i)           Board of Directors,

(ii)          Supervisory Board,

(iii)         Members’ Meeting, and

(iv)         General Director.

6.2         The scope of authority of the Agency’s bodies shall be laid down in the Articles of Association of the Agency.

6.3         The Parties hereby approve the following persons as the first members of the Board of Directors of the Agency:

(i)           Ing. Jaromír Miklas, residence: classified (personal data) personal identification number: XXXXXX/XXXX,

(ii)          Ing. Martin Šustr, PhD., residence: classified (personal data) personal identification number: XXXXXX/XXXX,

(iii)         member of the Board of Directors to be elected by the members of the Agency belonging to the group of members referred to in 6.4(ii) of the Articles of Association of the Agency at a meeting of such a group of members of the Agency,

(iv)         member of the Board of Directors to be elected by the members of the Agency belonging to the group of members referred to in 6.4(ii) of the Articles of Association of the Agency at a meeting of such a group of members of the Agency.

6.4         The Parties have approved Ing. Jaromír Miklas, residence: classified (personal data) personal identification number: XXXXXX/XXXX, as the first chairman of the Board of Directors.

6.5         The Parties hereby approve the following persons as the first members of the Supervisory Board of the Agency:

(i)           Dr. h. c. prof. Ing. Jozef Mihok, PhD., residence: classified (personal data) personal identification number: XXXXXX/XXXX,

(ii)          Dr. h. c. Ing. Vladimír Mošat, CSc., residence: classified (personal data) personal identification number: XXXXXX/XXXX,

(iii)         member of the Supervisory Board to be elected by the members of the Agency belonging to the group of members referred to in 6.4(ii) of the Articles of Association of the Agency at a meeting of such a group of members of the Agency,

(iv)         member of the Supervisory Board to be elected by the members of the Agency belonging to the group of members referred to in 6.4(ii) of the Articles of Association of the Agency at a meeting of such a group of members of the Agency,

(v)          member of the Supervisory Board to be elected by the members of the Agency belonging to the group of members referred to in 6.4(ii) of the Articles of Association of the Agency at a meeting of such a group of members of the Agency.

6.6         The first chairman of the Supervisory Board shall be elected by the members of the Supervisory Board at a meeting of the Supervisory Board.

6.7         The Parties have agreed that the First Members’ Meeting shall be held within three (3) working days after the formation of the Agency. The Agency shall notify the founding members in writing (by a letter, fax, or e-mail) of the place, date and exact time of the First Members’ Meeting. The agenda of the First Members’ Meeting shall include the approval of the draft budget for 2014, the approval of the amount of price for procuring the maintenance of emergency stocks, and adoption of the criteria for selection of a recognized stock keeper.

6.8         The Parties have approved Ing. Jaromír Miklas, residence: classified (personal data) personal identification number: XXXXXX/XXXX, as the first General Director.

6.9         At least two members of the Board of Directors - one of them being the chairman - shall always act on behalf of and be entitled to bind the Agency. Signing on behalf of the Agency shall be performed by attaching the signatures of signatories to the printed or written name of the Agency and to the names and positions in the Board of Directors of the Agency.

6.10      The General Director shall act on behalf of the Agency and shall be entitled to bind the Agency within the scope of his powers in accordance with the Articles of Association of the Agency.

7                   Final Provisions

7.1         In accordance with Section 15(3) of the Act, this Foundation Agreement (including the Articles of Association of the Agency) shall enter into force after its signing by all the Parties and its approval by the Government of the Slovak Republic.

7.2         Any amendments to the Foundation Agreement shall be made by a written agreement of the Parties. Any amendment to the Foundation Agreement shall only become effective upon a prior consent of the Government of the Slovak Republic.

7.3         The Parties authorize Mr. Filip Juriš, permanent residence: classified (personal data) personal identification number: XXXXXX/XXXX, to file the application for registration of the Agency with the competent District Office Bratislava within 5 days from the entry of this Foundation Agreement into force, as well as to receive the decision of registration of the Agency, to file an appeal or to waive the right to appeal against the decision of the competent office.

7.4         Unless stated otherwise herein, the mutual relations of the members shall be governed by the applicable provisions of the Civil Code.

7.5         Persons acting on behalf of the Agency before of its formation shall be liable jointly and severally for such acting. If the Board of Directors of the Agency approves such acting on behalf of the Agency within three months from the date of formation of the Agency, it shall apply that the Agency shall be liable for such acting from the beginning.

7.6         Before formation of the Agency, the Reserves Administration or a person appointed by the Reserves Administration shall act on its behalf. The person acting on behalf of the Agency before its formation must not assume other obligations than those which are connected with the formation of the Agency and with the provision of preparedness for taking over the emergency stocks. The costs incurred by the person acting on behalf of the Agency under the preceding sentence shall be reimbursed by the Agency after its formation. The costs incurred by the person acting on behalf of the Agency under the preceding sentence shall be deemed to be the costs connected with the foundation and formation of the Agency and the Agency shall reimburse them within twelve months from its formation.

7.7         The Parties have agreed on the following persons and their contact data intended for communication in connection with this Foundation Agreement:

[Page with contact data follows]

7.8         Unless the context of this Foundation Agreement expressly provides otherwise, the following interpretation rules shall apply:

7.8.1     Division of this Foundation Agreement into articles and paragraphs and insertion of headings are for convenience and reference only and have no impact on the explanation or interpretation of this Foundation Agreement. The expressions “this Agreement”, “in this Agreement”, “below” and similar expressions shall refer to this Agreement and not only to a certain particular article or paragraph or any other part hereof and they shall also apply to any additional agreement hereto. References to articles, paragraphs and annexes specified herein shall be references to articles, paragraphs and annexes of this Agreement.

7.8.2     The words used in this Agreement in the singular form shall include the plural and vice versa. Words used in the masculine gender shall include the feminine and neuter genders and vice versa.

7.8.3     For purpose of this Foundation Agreement, the term “emergency stocks” and other terms defined in the Act shall have the same meaning as stipulated by the Act.

In witness of the aforementioned the Parties put their signatures hereto on the date shown next the respective signature on the signature page below.

[Signature page follows]