IMPLICACIONES PARA LA GESTIÓN

Contents of annual reports pursuant to the Accounting Act and half-year and annual reports pursuant to the Capital Market Undertakings Act;

Making agreements on the establishment of a business corporation or association, on the Company’s acquisition of a stake in another legal entity, and on the dissolution of a business corporation or association or on the sale of the Company’s stake in another legal entity;

Alienation or lease of real estate, if so indicated in the Company’s bylaws or the Signature Rules of ČEZ, a. s. The Board of Directors must seek the Supervisory Board’s prior approval to make some of its decisions. These include, in particular, decisions regarding:

Acquisition, alienation, pledging, or lease of immovable and/ or movable property (except for inventories and securities held for liquidity-management purposes) that are to be, or are, included in the Company’s assets and whose book value exceeds CZK 500m;

Company capital projects with a value exceeding CZK 500m;

Operations with stakes in other legal entities, based in the Czech Republic or abroad, under the terms and conditions specified in the Company’s bylaws;

Transfers and pledging of treasury stock;

Staffing of the supervisory boards of companies in whose capital the Company has a stake exceeding CZK 500m. The Supervisory Board may reserve, by its resolution, the right of prior consent even with regard to a company where the stake in the stated capital does not exceed CZK 500m; Draft contract with the auditor appointed by the General

Meeting to conduct the mandatory audit;

Alienation of real property if the market or appraisal price of the real property exceeds CZK 100m;

Granting a loan to a third party or the Company’s providing a guaranty for a third-party debt that in each individual case exceeds CZK 200m. A controlled entity is not deemed a third party;

Acceptance of a long-term loan from a third party for a period of more than one year or another similar long-term financial operation (except a hedging operation) exceeding CZK 500m. A controlled entity is not deemed a third party; On issuing bonds other than those for which the approval of the General Meeting is required within the meaning of Section 421(2)(d) of the Business Corporations Act; Granting of Company stock options where the law permits

the Board of Directors to do so;

Company transformation pursuant to law;

Concluding a contract under which the Company is to acquire or alienate assets if the value of the acquired or alienated assets during one accounting period exceeds one-third of the Company’s equity as shown by the last consolidated financial statements;

Enabling the conduct of due diligence (legal, commercial, technical, and/or environmental audit) of the Company and/ or any of its organizational units;

Concluding management contracts with Company division directors that are not members of the Board of Directors and appointing the chief executive officer;

Defining and evaluating individual assignments for Company division directors that are not members of the Board of Directors;

Distribution of tender specifications to tenderers for public contracts pursuant to the Public Procurement Act if the anticipated value of the contract is greater than one-third of the Company’s share capital as shown by the last consolidated financial statements.

The Board of Directors must submit certain matters to the Supervisory Board for review and seek the Supervisory Board’s opinion. This applies to, in particular:

Approval of and amendment to the Organizational Rules of ČEZ, a. s.;

Approval of rules for the creation and use of Company funds; Draft of annual capital and operating budgets;

Proposals for substantial changes in the Company’s organizational structure;

Proposal for the Company’s strategy or a substantial update thereto under the business policy approved by the General Meeting;

Draft of business plan of the Company;

Draft of business policies (including amendments thereto) of controlled entities with a stated capital exceeding CZK 500m;

Contents of tender specifications pursuant to the Public Procurement Act if the anticipated value of the contract is greater than one-third of the equity as shown by the latest consolidated financial statements;

Proposals to be presented by the Board of Directors to the General Meeting; however, it is sufficient to just notify the Supervisory Board of proposals that the Board of Directors is required to present to the General Meeting by law.

No later than by May 15 of each calendar year, the Board of Directors submits to the Supervisory Board for review the annual and consolidated financial statements together with proposals for profit distribution, the Board of Directors’ report pursuant to Section 82 of the Business Corporations Act, the manner of payment and due date of dividends, the amount of Board member bonuses, or a proposal for settlement of the Company’s losses. In addition, the Board of Directors submits to the Supervisory Board any extraordinary and interim financial statements for its review.

Pursuant to the Company’s bylaws, the Board of Directors must notify some of its decisions to the Supervisory Board.

The Board of Directors may entrust its members with powers according to a certain field of management and function in the organization structure, as defined in the Organizational Rules. In such a case, the member of the Board of Directors is authorized, within the scope of the entrusted powers, to manage the Company division or department in question. In conjunction with such authorization, the member of the Board of Directors is also entitled to use the title of the position so delegated (Chief Executive Officer, division head). When acting on behalf of the Company in legal matters (e.g. signing contracts), they always use the title “member/Vice-Chairman/ Chairman of the Board of Directors”.

36

ČEZ

, a. s.

Go

ver

ning Bodies of ČEZ

, a. s.

Daniel Beneš

Chairman of the Board of Directors and Chief Executive Officer

37