november 22, 2012 poland, kraków

Case IX GC 64/12

JUDGMENTIN THE NAME OF REPUBLIC OF POLAND

November 22, 2012

District Court in Krakow, IX Commercial Division composed of:

Chairman:Cłerk:

District Court Judge Grzegorz MazurSenior court recorder Małgorzata Wegrzyn

after hearing on November 22,2012 in Krakowproceedingin a case brought by Jan Domanus, Andrew Kozłowski and Izabeła Kozłowskiagainst KRAKOW BUSINESS PARK Ltd.in Zabierzowwith incidentał intervening of Adam Swiech

for dissołution of company

l. petition is denied;II. orders the Płaintiffs Jan Domanus, Andrew Kozłowski and Izabeła Kozłowski to

jointły pay to the Defendant KRAKOW BUSINESS PARK Ltd. in Zabierzow thesum ofPLN 58,737.00 (fifty eight thousand seven hundred thirty seven) asrepayment of the court costs;

III. orders the Płaintiffs Jan Domanus, Andrew Kozłowski and Izabeła Kozłowski tojointły pay to Adam Swiech the sum of PLN 6,797.00 (six thousand sevenhundred ninety seven PLN) as repayment ofthe court costs.

SealoJDistrict Courtin Krakow

Case IX GC 64/12

[Stamp): appropriate signatures a.ffixed on the originalCertified true copyMalgorzata Wegrzyn, Senior Clerk

JUSTIFICATION.Of the judgment dated November 22, 2012

Plaintiffs Andrew Kozlowski, Izabela Kozlowski and Jan Oomanus petition this Court for

dissolution of a limited liability company known as Krakow Business Park Ltd. located in

Zabierzow. Besides the Plaintiffs the above mentioned company has an additional shareholder

Adam Swiech who owns majority stake. As a basis for dissolution ofthe Company it was pointed

out: actions of the majority shareholder, who committed numerous crimes against minority

shareholders and the Company; questions as to real number of shares held by the individual

shareholders, with exemption of Izabela Kozlowski; discrimination of minority shareholders by

Adam Swiech through, among others, making access to documentation of the Company

impossible; lack of reaction from Adam Swiech to the questions raised in relation to payments

made by subsidiary company for services performed by non-existing American company; taking

possession of shares of Jan Oomanus by Adam Swiech and exercising voting rights contrary to

previous assurances; not reporting Jan Oomanus in the Book of Shares and not reporting him and

Izabela Kozlowski in Registrar Court; not maintaining the Book of Shares; issue of alleged loan

to Jan Oomanus which in fact was a dividend; appropriation by Adam Swiech the funds

belonging to John Oodmanus; organizing an Extraordinary Meeting of Shareholders with the use

of remote communication means; existence in a Company so called "Silent Shareholders";

creation of a structure of organization with a goal of aggrieving minority shareholders; payments

made to Cypru s Company despite the fact that the Company did not perform any consulting

services; lack of dividends; falsification of minutes of the Shareholders Meeting and attendance

list dated March 26, 2008. The aforementioned circumstances prove that there is an open and

sharp conflict between the shareholders, which makes the Company's operations impossible.

In response to the petition the Defendant Company Krakow Business Park Ltd. asked

the Court to dismiss the claim as unjustified. In the justification it was stated that the Defendant

created one of the largest office complexes in the Małopolskie Province, what was the

Company's main goal, accepted by ali the shareholders. The aforementioned undertaking

couldn 't be successfully achieved without mutual cooperation of all shareholders. Lack of

payment of dividend was, among other, a result of the resolution adopted in this respect in

connection with the loan taken by KBP-l Ltd. The Company's Board of Oirectors has never

limited access of the Plaintiffs to the Company's documents. Furthermore, the Plaintiffs have

never exercised the right provided for in Article 212 point 4 Code of Commercial Companies.

Plaintiff Andrew Kozlowski was one of major authors of KBP's development strategy and alI

other shareholders actively participated in this project. There is no court case in the matter of

determining a real number ofshares held by Andrew Kozlowski and Jan Domanus. New Board of

Directors undertook actions necessary for recreation of the Book of Shares, sending necessary

letters to the shareholders. Lack of registration of Izabela Kozlowski and Jan Domanus in Court

Registrar as the shareholders is compliant with the law regulations. Circumstance of Adam

Swiech's temporary detention doesn't obstruct proper functioning ofthe Defendant Company. It

should also be pointed out that the shareholders are capable of adopting binding resolutions,

therefore there are no reasons for dissolution ofthe Company.

In the a motion from May 12, 2009 Adam Swiech petitioned this Court for incidental

intervening on the side of the Defendant Company joining the argumentation of the Defendant

Company and requesting the Court to deny the petition in its fuli scope and awarding him the

court costs.

District Court in its verdict dated April 30, 2009 dissolved the Defendant Company,

however the Court of Appeals cancelled this verdict. The Court of Appeals ordered that

evidentiary procedure should be carried out and explanation found, why the Company operated

until 2008 without a Book of Shares being kept.

After conducting entire evidentiary procedure petitioned by both sides and incidental

intervening party, the Court found as follows.

Facts of the case are as folIows:

Company Krakow Business Park Ltd. With its registered office in Zabierzow was

incorporated on June 24, 1997.

Proof: certified copy of entries in the National Court Register

On July 24, 1997 contract for sale of shares between Stanislaw Lewak and Richard

Swiech was signed. On the basis ofthe aforementioned contract Stanislaw Lewak sold to Richard

Swiech 40 shares in Krakow Business Park Ltd.

Proof: contract pages 1072-1074

On July 24, 1997 contract for sale of shares between Stanislaw Lewak and Czeslaw

Obodzinski was signed. On the basis of the aforementioned contract Stanislaw Lewak sold to

Czeslaw Obodzinski 20 shares in Krakow Business Park Ltd.


On September 10, 1997 Extraordinary Meeting of Shareholders was held, where all ofthe

shareholders where present. At that time resolution granting consent to sale of shares was voted

and approved.

Proof: minutes page 1077

On September 10, 1997 contract for sale of shares between Richard Swiech and Adam

Swiech was signed. On the basis of the aforementioned contract Richard Swiech sold to Adam

Swiech 8 shares in Krakow Business Park Ltd.

Proof: contract pages 1082- 1083

On September 16, 1997 contract for sale of shares between Stanislaw Lewak and Andrew

Kozlowski was signed. On the basis of the aforementioned contract Stanislaw Lewak sold to

Andrew Kozlowski 8 shares in Krakow Business Park Ltd.


On September 18, 1997 contract for sale of shares between Stanislaw Lewak and Izabela

Kozlowski was signed. On the basis ofthe aforementioned contract Izabela Kozlowski acquired 8

shares in Krakow Business Park Ltd.


On October 2, 1997 contract for sale of shares between Richard Swiech and Derek

Lewicki was signed. On the basis of the aforementioned contract Derek Lewicki acquired 16

shares in Krakow Business Park Ltd.


On September 14, 1998 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, on which all shareholders where present. At that time, among other, the resolutions

on increasing the initial capital, purchase of real estate and sale of real estate were voted and

approved.

Proof: protocol pages 1090-1094

On November 19, 1998 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, on which ali shareholders where present. At that time, among other, the resolutions

on increasing the initial capital, were voted and approved.

Proof: protocol pages I 100-1 102

On December 9, 1998 a resolution ofthe Board of Krakow Business Park Ltd. allocating

the shares in the initial capital not taken up until that time was voted and approved. Adam

Swiech, Andrew Kozlowski and Stanislaw Lewak took up newly issued shares on the basis ofthis

resolution.

Proof: resolution page 1099

On February I, 1999 a contract for financial consulting between Krakow Business Park

Ltd. and TSP Ltd. in connection with the extensions of the first phase of Business Park by

construction 8,000 square meters of office space.

Proof: contract pages I 109-11 17

On May 14, 1999 Extraordinary Meeting of Shareholders was held, on which all

shareholders were present except for Czeslaw Obodzinski. The resolution on increase of the

initial capital was voted and approved, amon g other.


On July 15, 1999 a resolution ofthe Board ofKrakow Business Park Ltd. allocating the

shares in the initial capital not taken up until that time was voted and approved. Adam Swiech,

Andrew Kozlowski and Stanislaw Lewak took up newly issued shares on the basis of this

resolution.

Proof: resolution page 1099

On February 23, 2000 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, on which all shareholders where present except for Czeslaw Obodzinski. The

following resolutions were voted and approved: on increase of the initial capital, on dismissal of

Stanislaw Lewak and Andrew Kozlowski frorn the Board of Directors, and on appointing Adam

Swiech as a President ofthe Board.


On May 22, 2000 Extraordinary Meeting of Shareholders of Krakow Business Park Ltd.

was held, on which alI shareholders where present except for Czeslaw Obodzinski. The resolution

on increase ofthe initial capital was voted and approved, among other.

Proof: protocol pages I 141-1 146

On May 22,2000 Andrew Kozlowski sent to Adam Swiech a Memorandum prepared by

CMS Cameron McKenna Ltd. concerning expansion of the organizational structure of Krakow

Business Park Ltd. The aforementioned document proposed, among other, creation of II

Subsidiary Companies.

Proof: document pages 907-919

On July 6, 2000 Extraordinary Meeting of Shareholders of Krakow Business Park Ltd.

was held, on which ali shareholders where present. Resolution granting consent to sale of shares

by Czeslaw Obodzinski to Adam Swiech was voted and approved.


On October 18, 2000 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, on which all shareholders where present. The following resolutions were voted and

approved: on increase of the initial capital, on granting consent to sale of shares by Richard

Swiech and Derek Lewicki to Adam Swiech.


On May 16, 2003 an Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held in the Notary Office, on which all shareholders where present. The following

resolutions were voted and approved during the meeting: on increase of the initial capital, on

changing By-Laws of the Company, on selecting auditor to audit financial statements of the

company, on granting consent to sale of shares by Stanislaw Lewak to "SMALL Ol" Ltd. in

Zabierzow.


On July l, 2003 a lease contract between KBP-l Ltd. (the Lessor) and Business Center

Solution Ltd. (the Lessee) was signed. In accordance with the contract lease payments where to

be updated by price index on January l of each year. In addition the Lessee was responsible for

covering maintenance costs ofthe building.

Proof: contract

On August 20, 2003 Meeting of Shareholders of Krakow Business Park Ltd. was held, on

which all shareholders where present. The following resolutions where voted and approved; on

approving the report on work ofthe Board, approving the Company's balance sheet and profit &

loss statement for the year 2002, on covering losses from future profits and acknowledgement of

fulfillment ofBoard's duties in the year 2002.


In July of 2004 Meeting of Shareholders of Krakow Business Park Ltd. was held, on

which all shareholders where present. The following resolutions where voted and approved; on

approving the report on work of the Board, approving the Company's bal ance sheet and profit &




On September 9, 2004 in the Notary Office a loan agreement, among other, was signed

between Stanislaw Lewak (borrower) and Jan Domanus (lender). On the basis of that loan

agreement Jan Domanus obligated himselfto pay to Stanislaw Lewak the amount of $157,000.00.

In order to secure repayment of the loan Stanislaw Lewak reassigned 1145 shares in Krakow

Business Park Ltd. ofthe total value PLN 572,500.00 and transferred them to Jan Domanus.

Proof: Notary Act pages 273-274

On September 17, 2004 Adam Swiech as a President of the Board of Krakow Business

Park Ltd. submitted to Registrar Office an up-to-date list of shareholders showing Andrew

Kozlowski, Izabela Kozlowski Adam Swiech and Jan Domanus. The aforementioned list was

attached to Registrar files ofthe Company.

Proof: documents pages 72-73

Registrar Court Decision page 74

On November 22 and 23, 2004 Jan Domanus signed Exhibits 17 and 22 to the loan

agreement with KBP-1, in which he obligated himself, among other, to granting subordinated

loans to Krakow Business Park Ltd., and not to adopt resolution, among other, on paying

dividends to shareholders.

Proof: exhibits pages 893-896

Between December 9 and 14, 2004 Adam Swiech Andrew Kozlowski and Izabela

Kozlowski signed Exhibit 22 to the agreement ofloan granted to KBP-1, in which they obligated

themselves not to adopt resolutions described in detail in the document (it concerned, among

other, a resolution on paying dividends to the shareholders).


In March of 2005 Meeting of Shareholders of Krakow Business Park Ltd. was held, on

which all shareholders where present. The following resolutions where voted and approved: on

approving the report on work ofthe Board, approving the Company's balance sheet and profit &




On November 1, 2005 a lease agreement was entered into between Business Center

Solution (the Lessor) and KBP-1 Ltd. (the Lessee). Subject ofthat agreement was office space,

which was a subject of the lease agreement dated July 1, 2003. In accordance with a lease

agreement rent was set at the equivalent to $34.00 for one square meter, and the Lessee was

responsible for payment ofmaintenance costs.

Proof: agreement

In March of 2006 Meeting of Shareholders of Krakow Business Park Ltd. was held, on which all

shareholders where present (Adam Swiech, Andrew Kozlowski, Jan Domanus and Izabela

Koziowski). The following resolutions where voted and approved; on approving the report on

work of the Board, approving the Company's bal ance sheet and profit & loss statement for the

year 2005, on covering losses from future profits and acknowledgement offulfillment ofBoard's

duties in the year 2005.


On June l, 2006 the lease agreement was signed between Business Center Solution (the

Lessor) and KBP-2 Ltd. (the Lessee). According to the agreement the lease rent was set at $34.00

per square meter.

Proof: agreement

On December 15, 2006 the lease agreement was signed between KBP-2 Ltd. (the Lessor)

and Business Center Solutions Ltd (the Lessee). According to the agreement the rent was set at

equivalent to EURO 10.00 per square meter. In addition the Lessee was responsible for paying

maintenance charges ofthe building.

Proof: agreement

On December 15, 2006 the lease agreement was signed between KBP-2 Ltd. (the Lessor)

and Business Center Solutions Ltd (the Lessee). According to the agreement the rent was set at

equivalent to EURO 4.00 per square meter. In addition the Lessee was responsible for paying

maintenance charges ofthe building.

Proof: agreement

In March of2007 Meeting of Shareholders of Krakow Business Park Ltd. was held, on which ali

shareholders where present (Adam Swiech, Andrew Kozlowski, Jan Oomanus and Izabela

Koziowski). During the aforementioned meeting report from work of the Board was submitted,

balance sheet and profit & loss statement of the Company for the year 2006 were presented. Ali

the shareholders unanimously approved the presented documents by adopting an appropriate

resolution. A resolution was also adopted, according to which the profit generated in 2006 was to

be allocated to cover the losses generated in the previous years. AIso fulfillment of Board's duties

in the year 2006 was acknowledged.

Proof: minutes and attendance list pages 114-116

On May 21 2007 Extraordinary Meeting of Shareholders of Krakow Business Park Ltd

was held., and voting on resolutions was carried out in electronic matter.

Proof: minutes pages 305-306

On September 27,2007 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, on which alI shareholders where present (Adam Swiech, Andrew Kozlowski, Jan

Domanus and Izabela KozIowski). The following resolutions where voted and approved:

commitment not to sell shares for the period of 36 months, on granting consent to sale of shares

by Jan Domanus and Andrew Kozlowski to Adam Swiech, on selecting PROTORlUS Ltd. as the

main adviser to the Board with a remuneration of $20,000.00, on appointing Adam Swiech as the

President of the Board, on making a decision on commencement of works on transferring the

Company in to public joint stock company and (spółka akcyjna) and preparing the Company for

its listing on Stock Exchange, on granting consent to establish security instruments on the

Company's shares and assets.


On November 16, 2007 the sublease agreement was signed between Business Center

Solutions Ltd. (the Lessor) and KBP-9 Ltd. (the Lessee). According to the agreement the rent was

an equivalent to EURO 34.00 for one square meter. The Lessee was obligated to pay maintenance

charges for the building.

Proof: agreement

On November 30, 2007 two contracts of support were entered into between KBP-5 Ltd.

(supported) and Krakow Business Park Ltd. and between KBP-6 Ltd. and Krakow Business Park

Ltd. The aforementioned agreements also set forth monthly remuneration due to Krakow

Business Park Ltd. in the amount ofPLN 92,500.00.

Proof: two support agreements

In March of2008 Meeting ofShareholders ofKrakow Business Park Ltd. was held, on which alI

shareholders where present (Adam Swiech, Andrew Kozlowski, Jan Domanus and Izabela

KozIowski). During the meeting report from work of the Board was submitted, bal ance sheet and

profit & loss statement of the Company for the year 2007 were presented, which were

unanimously approved by all the participants. The resolution was also adopted, according to

which the profit generated in 2007 was to be allocated to cover a part the losses generated in the

previous years. AIso fulfillment ofBoard's duties in the year 2007 was acknowledged.

Proof: minutes and attendance list pages 132-134

On August 14, 2008 Extraordinary Meeting of Shareholders of Krakow Business Park

Ltd. was held, the minutes of which was prepared by a Notary. On the aforementioned meeting

alI shareholders where represented by their attomeys. The following resolutions where voted on

and approved: on amending Section 15 of the Company By-Iaws; on approving report of the

Board and financial statements for the year 2007; an appointing President ofthe Board; on setting

a monthly remuneration for the President ofthe Board. The attorney ofthe minority shareholders

voted against all ofthe aforementioned resolutions and objected to them.


District Court in Krakow, IX Commercial Division in a verdict dated November 18,

2008, case num ber IX GC 331/08 ruled null and void the resolution dated August 14, 2008 on

amending Section 15 ofCompany By-Iaws and dismissed the remaining petitions.

Proof: copy ofthe verdict page 830

Adam Swiech and Andrew Kozlowski had consultations concerning tax structure of land

ownership by Krakow Business Park Ltd. Th~ Opinion issued as a result of that cooperation

assumed among others a creation of 11 Companies, i.e. entities which would be the property

owners.

Proof: pages 907-919

In a letter dated June 2, 2008 Andrew Kozlowski, Jan Domanus and Izabela Kozlowski

submitted a notice of suspicion of committing criminal offence by Adam Swiech.

Proof: notice pages 769-799

On August 7, 2008 the investigation was initiated concerning suspicion of committing a

number of criminal offences against Andrew Kozlowski, Izabela Kozlowski, Jan Domanus and

the Company Krakow Business Park Ltd., as well as State Treasury.

Proof: Decision ofinitiating investigation pages 162-163

On September 13, 2008 District Attorney for Krakow decided to charge Adam Swiech

with four charges concerning criminal offences committed in organized crime group to the

detriment of Andrew Kozlowski, Izabela Kozlowski, Jan Domanus and the Company Krakow

Business Park Ltd., as well as the State Treasury.

Proof: Decision to charge pages 164-167

With the decision dated September 15, 2008 case number XIV Kp 915/08/ Regional

Court for Krakow Śródmieście in Krakow, XIV Criminal Department applied to Adam Swiech a

preventive measure in the form of pre-trial detention.

Proof: a decision

With a decision dated October 23, 2008 District Attorney in Krakow secured on the

shares held by Adam Swiech in Krakow Business Park Ltd. a pen alty of a fine and penalty

punitive measures in the form ofthe forfeiture or obligation of compensation for damages.

Proof: decision

Andrew Kozlowski and Jan Domanus filed petitions dated October 23, 2008 about

establishing alegal evidence ofbeing a shareholder in Krakow Business Park Ltd.

]

Proof: petitians

On November 18, 2008 Extraordinary Meeting of Shareholders of Krakaw Business Park

was held, on which alI of shareholders where present, except for Izabela Kozlowski. Resolution

on changing agenda ofthe meeting was approved unanimously.


On November 18, 2008 President of the Board of Krakaw Business Park Ltd. submitted

documents concerning loan agreements to the attorney of minority shareholders.

Proof: letter page 906

On May 7, 2009 Extraordinary Meeting of Shareholders of Krakaw Business Park Ltd.

was held on which alI of the shareholders where present, except for Izabela Kozlowski. It was

decided that that meeting was incorrectly convened.


On May 22, 2009 Extraordinary Meeting of Shareholders of Krakaw Business Park Ltd.

was held, on which alI of the shareholders where present with exception of Izabela Kozlowski

and Andrew Kozlowski. The following resolutions were voted and approved: on dismissing Jan

Blajer from a position of President of the Board of Directors, on electing new President of the

Board, on changing remuneration of the President of the Board, on electing an attorney to sign

contracts with members ofthe Board.


By the verdict dated March 9, 2010 District Court in Krakaw, Department IX

Commercial case num ber IX GC 177/09 dismissed a petition of Izabela Kozlowski to establish

ownership of 1,028 shares in Krakaw Business Park Ltd. and obligation to publish those shares in

the Book of Shares.

Proof: capy ofthe verdict

By the decision dated November 22, 2010 District Attorney in Krakaw changed and

supplemented previous charges against Adam Swiech and presented him with tata I of 25 charges

ofcriminal offences shown in the Criminal Code and Criminal Treasury Code.

Proof: decision on changing and supplementing decision about charges

By the decision dated February 22, 2011 District Attorney In Krakaw changed and

supplemented previous charge s against Adam Swiech and presented him with additional 26-th

charge.

Proof: decision changing and supplementing decision about charges

By the decision dated March 29,2011 District Court for Krakaw Sródmieście in Krakaw,

Department XI Commercial ofthe National Court Register, empowered Adam Swiech to convene

Extraordinary Meeting of Shareholders of Krakow Business Park Ltd. in the subject, among

other, of adopting a resolutions on acknowledgement of fulfillment of the Board's duties, on

dismissing existing members ofthe Board and electing new members ofthe Board.

Proof: decision

On April 28, 20 l I Extraordinary Meeting of Shareholders of Krakow Business Park Ltd.

was held, on which all of the shareholders where present with exception of Izabela Kozlowski

and Andrew Kozlowski. The following resolutions where voted and approved: on

acknowledgement of fulfillment their duties by the members of the Board and President of the

Board, on dismissing existing members ofthe Board President ofthe Board, and on electing new

Board members and new President ofthe Board in person of Alicja Gostek-Swiech. The attorney

of Jan Oomanus voted against all above resolutions and objected to them.


On April 16,2012 Extraordinary Meeting ofShareholders ofKrakow Business Park Ltd.

was held, on which all ofthe shareholders where present.


On April 26, 20] 2 Extraordinary Meeting of Shareholders of Krakow Business Park Ltd.

was held, on which alI ofthe shareholders where present.


On May 2, 2012 Extraordinary Meeting of Shareholders of Krakow Business Park Ltd.

was held, on which alI of the shareholders where present. During the meeting the resolution,

among other, on increase of the Company's capital was adopted. The attorneys of Jan Oomanus,

Andrew Kozlowski and Izabela Kozlowski voted against that resolution and raised objection to

this resolution, without j ustification.


National Court Register file kept for Krakow Business Park Ltd. shows as the

shareholders: Adam Swiech holding 16,393 shares worth PLN 500.00 each and Andrew

Kozlowski having 4,346 shares worth PLN 500.00 each. In addition, the shareholders are: Izabela

Kozlowski holding 257 shares worth PLN 500.00 each and Jan Oomanus holding 1,145 shares

worth PLN 500.00 each. Proof: copy ofthe National Court Register Record

In relation to the companies from the Capital Group created by the Defendant Company

there was a num ber of investigations concluded by Directors of Office of Fiscal Control and

Treasury Chamber in Krakow in the subject of imposing additional tax amounts. Defendant

Company admitted existence of this circumstance, provided that that in the course of the

proceedings carried out by the tax authorities a presurnption of guilt was applied, therefore, they

do not constitute a basis for putting in allegations against the Defendant Company in the

proceedings. The decision documented by the Plaintiffs with copies concern various entities, not

only the Defendant Company (in file binder XI and XII).

The aforementioned actual state of affairs was determined by the Court based on the

documents included in the case file, with regard to which the court found no grounds to question

their credibility. At same time in the Court's mind they are sufficient for fuli reconstruction ofthe

Company's activities. It should be pointed out, that Plaintiffs did not provide accurate data

concerning existence of the Defendant Company and activities undertaken by it, and oniy

emphasized an existing conflict between the shareholders. The Plaintiffs themselves pointed out

that all information is included in the case file and they referred to it.

At the request of the Plaintiffs filed before closing the case, the Court allowed and

conducted (within the scope requested by the Plaintiffs) proof from opinion of court experts

called on by the Oistrict Attorney in a course of the proceeding VI Ds. 49108/Sp. The Defendant

did not challenge existence of financial operations shown there, however it challenged alegal

assessment of such operations, and furthermore pointed out that that the criminal investigation

has not led to indictment until that time. In particular the Court examined conclusions ofthe court

experts. It should be pointed out; that opinion issued by expert Magdalena Kupiec dated February

4, 2011 (page 3020) includes analysis of capital flows on the basis of documentation made

available to her in a course of criminal investigation. Court expert did not formulate definitive

conclusions. The expert in fact analyzed accounting records, picturing the financial tlows and

showing which documents are missing to present a full picture of the flows. In her concluding

remarks the expert indicates where one should look for further financial documents.

The Plaintiffs referred also to the opinion of expert of the certified auditors Lech Stanczyk, and

Beata Cala dated July 31,2010 (page 3158) issued in the course ofthe criminal proceedings VI

Ds. 49/08 Sp. Plaintiffs drew attention to the conclusions of the experts. The experts stated, that

transactions selected by them (page 3418) raise their doubts as to the reality of the services

performed. On the following pages (page 3421) the experts expressed their opinion that money

transferred out by Adam Swiech in the form of loans came from fictitious transactions that took

place in the companies belonging to the KBP Capital Group.

Plaintiffs allege that this is the evidence of the "transfer-out" of financial resources from the

Defendant Company to the benefit of Adam Swiech. In the opinion of the Court a significant

difficulty in interpreting the opinion of experts formulated in such way, results only from the use

of the term "fictitious". Experts' opinion does not allow for determining what defects of the

statements of will should be assigned to the individual transactions. The opinion is a material

associated with other evidence compiled in criminal proceedings, evidence not known to this

Court. Civil Court is unable to eonduet a separate qualification of these transactions on the basis

of presented opinions. What is important, considerable financial flows relate to relationships of

the Defendant Company with its "subsidiaries", what does not seem to violate rights of the

Defendant Company as a shareholder in "subsidiaries". What is even more important, model of

Capital Group was created during the harmonious existence of the Defendant Company, what is

clearly indicated by the documents from pre-filing period. It should be noted that the transactions

before the spring of2008 took place with the fuli possibilities of control by the Plaintiffs, and the

resolutions indicate their acceptance in the unanimous vote. In a later period, at the request ofthe

Plaintiffs, the Defendant Company is being extensively controlled by tax authorities and District

Attomey's Office. These controls reveal a num ber oftransgressions, but this does not change the

assessment of the evidence, indicating that the Plaintiffs actively participated in undertaking and

accepting activities ofthe Company.

The Court considered evidence from testimonies of Plaintiffs (page 2741) from the

Defendant (page 3011 b) and incidental intervening party (pages 2747 and 3009b). Testimonies

ofthe Plaintiffs do not eonfirm the claims included in the petition concerning gradual build-up of

conflict among the shareholders, which led to the filing of this action in 2008. In light of the

above cited documents the shareholders harmoniously co-created the company, which was

already pointed out by the Court of Appeal when considering appeal to the previous judgment in

the case. Violent eruption ofconflict occurred only in the spring of2008. The culmination ofthe

Plaintiffs' actions was the decision for the temporary detention of Adam Swiech.

The court tried to find an answer to the question why such violent conflict erupted among

partners in mid-2008 in the shareholders' testimonies. Testimonies are fuli of subjective

comments about who is responsible for a conflict of shareholders. In the opinion of the Court,

shareholders do not report what financial issues evoke in the Plaintiffs feeling that they have

invested more than the incidentaI intervening party wants to repay them nowo This confirms

believes of the Court that the presented grounds for the c1aims included in the petition do not

correspond to the real relations among partners, which led to violent conflict and bringing an

action for dissolution ofthe Company.

The Plaintiffs pointed out that at the tum of 2007 and 2008 they decided to cash in their

shares, but shareholders have failed to agree on a price. They pointed out that later on, due to lack

of agreement by incidental intervener to pay claims submitted by them, they wanted to sell the

company, but intervener objected to such sale. Then they obtained c1ues pointing to financiaI

irregularities in the Company and informed District Attomey. Their allegations are confirmed in

the criminal proceedings. Plaintiffs feel "trapped" in the Company not being able to sell their

minority shares at their real value.

Intervener explained that after a period of harmonious development and cooperation, in

2008 the Plaintiffs wanted to sell the Com pany, which he refused. Then the Plaintiffs took actions

to take away from him the Company, where he was a majority shareholder, in fact actions leading

to destruction of the Company as a business entity. Despite these activities the Company

continues its development.

Chairman of the Board of the Defendant Company declared fulI co-operation with the

Plaintiffs as to interests ofthe Company.

Ultimately, the Court found that, despite the conflict of the shareholders, it does not

affect directly operations of the Company, which continues to develop the model of a capital

group, co-created by the shareholders a long time before 2008.

District Court found the followiog:

Finally, the Plaintiffs pointed out that the claim included in the petition was justified by

permanent and unavoidable conflict among the shareholders. Plaintiffs feel trapped in the

Defendant Company, which was appropriated by the incidental intervener. This situation causes

that the objective ofthe Company carmot be achieved. The factual basis ofthe claim was indicted

by the Plaintiffs in the petition in 2008, and the Court is bound by it. The fact of escalating

conflict of shareholders in the course of these proceedings, it is an inevitable consequence of the

Plaintiffs decision from 2008 to initiate criminal and present proceedings. As a result of the

Plaintiffs' action the Defendant Company is fully transparent. Intensive controls by tax

authorities and law enforcement agencies are undertaken. The Defendant Company maintains

liquidity; since - as indicated by the Defendant - the banks did not halt financing of extensive

investment (fact known to the Court on its own initiative). The Plaintiffs carry out current

controls by prosecuting resolutions to Court.

Conflicts among shareholders in companies are a natural phenomenon. Shareholders,

including minority shareholders, benefit from the protection provided for in the regulations ofthe

Code of Commercial Companies. The right to request dissolution of a company is a most far-

reaching right. Enforcement of this right is therefore the last resort. In the opinion of the Court,

the evidence gathered in course of the case, failed to show that the circumstances specified in

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Article 271 ofthe Code ofCommercial Companies occurred for dissolution ofKrakow Business

Park Ltd..

Pursuant to Article 271 of the Code of Commercial Companies, except in the cases

referred to in Article 21, the court may declare dissolutions of the company when demanded by

shareholder or member of the company's governing body, if attaining the company's objective

becomes impossible or, if another important reason exists caused by the Company's relationships.

Court decisions consistently state that a failure to achieve the objective of the company may be

caused by the conf1ict that exists between its shareholders, as a result of frictions between two

fractions of shareholders with a balanced number of votes, when is not possible to pass

resolutions, which hinders the proper operations of a company (see Decision of the Supreme

Court dated April 10, 2008 TV CSK 20/08). An objective of each commercial company, both

personal as well as capital, similarly to every corporation, i.e. association of people, is pursuit to

achieve a common objective (Article 3 Code ofCommercial Companies). It does not only refer to

business objectives, but also social ones, and the basie feature of every company is an idea of a

co-operation among partners (shareholders). Shareholders of a limited liability company should

pursuit to achieve a com mon objective during the entire period of its existence. When reaching

company's objectives becomes impossible, the Act indicates, as fundamental, lian important

cause" for dissolving a company by the court (Article 271 paragraph I of the Code of

Commercial Companies). The impossibility of achieving the objective should be permanent and

continuous. It is assumed that the impossibility ofachieving a limited liability company's purpose

must be objective, which means that such company is not able to reach an agreed objective,

despite making legal and organizational efforts. Other important causes include: lack ofability to

make a decision in the company (decision-making "lock"), lack of governing bodies and inability

to appoint them, permanent use of majority shareholder's position, lack of interest in the

company's affairs by its shareholders, permanent conf1icts between board members, depriving a

shareholder of its rights by other shareholders, a breach of Article 20 of the Code of Commercial

Companies.

In the literature, there are also opinions, that dissolution of a company, which has the

ability to operate in the market, should be the final solution. A mere violation of some minority

shareholder's (shareholders') rights, even ofa notorious character, is not a sufficient circumstance

for a court to issue ajudgment on dissolution ofa company. Violations ofthese rights should lead

to further negative consequences in the functioning of the company, for example majority

shareholders when adopting resolutions violate good manners and hurt minority shareholder, who

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then effectively brings an action against such resolution (see Dominika Wajda, Glossary to the

Court of Appeal judgment ofNovember 9, 2006 and Aca 575/2006, Glossary 2008.2.53).

With regard to the allegation of non-disclosure in the National Court Register of the

shareholders Jan Domanus and Izabela Kozlowski, it should be noted that, pursuant to Article 36

paragraph 8 letter C ofthe National Court Register Act dated August 20, 1997, only shareholders,

who own at least 10% ofthe shares should be recorded in the register. Therefore, ifthe shares of

Jan Domanus and Izabela Kozlowski did not cross the aforementioned threshold, they should not

be recorded in the register. The fact of not recording them doesn't cause that Jan Domanus and

Izabela Kozlowski are not shareholders in the Company and do not have any rights. Despite the

fact that they where not recorded in the register, they may exercise their rights arising from

ownership of shares in Krakow Business Park Ltd. In addition, it should be noted that both Jan

Domanus and Izabela Kozlowski were present at the Meetings of Shareholders, as shown by the

attendance lists and exercised their rights to vote on them. Thus, their position as shareholders

was never in danger, since they exercised the powers available to shareholders. It is significant

that until 2008, none of the partners raised any doubts about the amount of their shares; and also

that the resolutions were passed easily and have not been objected by anyone either in the formaI

or substantive context. General Meetings of Shareholders were held on a regular basis and there

were no problems with adopting resolutions. For a period of II years there were no disputes

between the shareholders as to their shares in the Company, which would find its final in court

proceedings. The Plaintiffs did not prove that the lack of the Book of Shares, or any irregularity

in keeping it, had any impact on functioning of the Company. In the opinion of the Court in the

light of the minutes of shareholders meetings, it should be considered that any deficiencies in

administration of the Book of Shares did not constitute an obstacle to efficient development of

Krakow Business Park Ltd.

It should also be noted that from the documents contained in the pages 72 and following

it arises that Adam Swiech, as the President of Krakow Business Park Ltd., filed on September

17, 2004, with the Court Registrar a current list of shareholders, which included Andrew

Kozlowski, Izabela Kozlowski, Adam Swiech and Jan Domanus. The aforementioned list of

shareholders was included by order of the Court to the Registrar files of the Company on

September 21, 2004.

It should also be noted that Jan Domanus was present at the meetings of shareholders and

took an active part in them, by voting. He did not question at that time the amount of his shares.

Thus, the current dispute between him and Adam Swiech about the fact of holding shares, in itself

can't constitute the ground for dissolution ofthe Company.

In the light of the gathered documents it cannot be admitted that the Plaintiffs were

discriminated by Adam Swiech as minority shareholders, and aJso that they had no influence on

the decisions made and directions ofthe Company's development. In the opinion ofthe Court the

Plaintiffs knew the financial and legaJ situation of Krakow Business Park Ltd. and actively

participated in its operations. The minutes from shareholders' meetings, which were held until

2008, and attendance Jists, show that al! shareholders were present at them, and that the resolution

where adopted unanimously. Minority shareholders did not raise any objections to the adopted

resolutions and did not challenge them in Court. The fact that since 2008 the Plaintiffs do not

agree with adopted resolutions and challenge them in Court, which some ofthem considered to be

invalid due to the violation of the rights of minority shareholders, carmot lead to a simple

presumption that during the entire period of existence of the Company the Plaintiffs were

discriminated, and their rights violated.

The Plaintiffs' attorney's claims that adopting resolutions and then challenging them in

court demonstrates a permanent status ofthe conflict cannot be considered as true. In the opinion

of the Court concordant adoption of resolutions over a period of 11 years in fact indicates that

there was no conflict between the shareholders at alI. In addition, gathered evidence indicates that

by mid-2008 no resolution was ever challenged in court by any ofthe shareholders. It should also

be noted that the Plaintiffs themselves admitted that the conflict between the partners existed

since mid-2008. Thus, it carmot be regarded as a permanent, growing over the years, since until

2008 actions where taken unanimously. It should also be noted that, if the circumstances

presented in this case would be found to be true, it would not be possible for the Company to

operate, and certainly not for a period of II years. In particular, it would be impossible to create

new organizational structures and generating profits by the Defendant Company. Shareholders

acting rationally in this situation should immediately take actions to "cure" the situation in the

Company, and not to wait passively for II years.

As a side remark it should be noted that the court proceedings initiated by the minority

shareholders since the second half of 2008 concerning the resolutions, in most cases ended with

dismissal of the actions. Thus, it should be considered that they were in line with the law

reguJations and do not infringe the shareholders' rights.

Plaintiffs repeatedly claimed that the majority shareholder's activity was based on a

number of irregularities in functioning of Krakow Business Park Ltd. and its subsidiaries, and by

numerous fictitious transactions. Nevertheless, in the opinion of the Court evidence gathered in

the case did not demonstrate that the actions of Adam Swiech were aimed against the minority

shareholders. It should also be noted that the documents col!ected in the case, the minutes from

Shareholders Meetings in particular, indicate that the Plaintiffs knew the real situation of the

Company, and also its undertakings or agreements concluded with the subsidiary-companies. It

should be noted that until 2008 the Plaintiffs also did not question the organizational structure of

the Defendant Company and creation of so called "Subsidiaries". In addition, the Plaintiff

Andrew Kozlowski, during questioning at the hearing admitted that all shareholders ordered from

an independent tax firm issuing opinions concerning financial and legal concepts of Krakow

Business Park Ltd. operations. Therefore, the doubt as to the validity or legality ofthe structure of

Krakow Business Park Ltd. should be considered as occurring suddenly, based on the subjective

grounds, not supported by any evidence. Until mid-2008, the cooperation between all

shareholders developed concordantly, without any conflicts. Thus, Plaintiffs' claims that for the

entire period of 11 years since the incorporation of the Company, they did not know about the

activities of Adam Swiech and did not have the opportunity to take appropriate actions, are hard

to believe. It should be underlined that until mid-2008 alI the shareholders were present at

Shareholder Meetings, in concordantly adopted resolutions, which then were not challenged in

Court. Thus, currently raised claims of numerous irregularities to the detriment of the Plaintiffs

find no support in the presented documentation, illustrating the operations of Krakow Business

Park Ltd. over 11 years.

The irregularities found in the course of the control procedures result, if applicable, in

responsibility of Krakow Business Park Ltd. to the State Treasury, and not against the minority

shareholders. The gathered evidence showed that the Plaintiffs knew the ways of functioning of

the Defendant Company, as well as the actions taken by it. Thus, if the Plaintiffs participated in

the meetings of the shareholders, voted on them, inter alia, on the approval of the financial

statements and the reports of the Board, they cannot now claim, that they were not aware of the

activities carried out by the Company. Therefore the irregularities found, whether in criminal or

other proceedings in the course of other inspections, in the structure of organization cannot be the

basis for the dissolution ofthe company.

One of the grounds authorizing the Court to dissolve the company under the Code of

Commercial Companies is inability to make any resolutions, which results in the inability to

manage the affairs of the company. In this case, the Company functioned well and, what should

be underlined, continues its operations. Although this fact is not disputed, the testimony of the

Defendant Company CEO (page 3011), which leaves no doubt about the condition of the

Company, should be indicated. The above indicates that there are no grounds for dissolution of

the Company.

The accusation that throughout the existence of the Company alI the time Adam Swiech

sought to "dilute" the shares of the minority shareholders through a share capital increase, should

also be considered as irrelevant. It should be noted that since the incorporation of the Company,

the resolutions on the capital increase were adopted unanimously. The aforementioned resolutions

where not accompanied by any objections raised by the minority shareholders. Therefore, the

present claims ofthe Plaintiffs that the increase ofthe share capital is intended to their detriment

have not been proved.

The allegation of existence of so-called "quiet shareholders", who among others was

supposed to be Ryszard Swiech, who acted on behalf ofthe Company without any authorization,

is groundless. It should be noted that, according to a copy of entries in the National Court

Register, Ryszard Swiech served as Company's commercial proxy, so he could make decisions

on its behalf and to represent it.

According to the adopted resolutions the losses initially incurred by the Company were to

be covered by the profits generated in subsequent years, and the subsequent resolutions referred

to it. So one cannot make accusations that no dividend was paid to the shareholders, when the

Company initially generated losses, which in subsequent years where to be paid out of profits. It

should be pointed out that all the members unanimously approved the financial statements for the

preceding years and adopted appropriate resolutions, under which income generated in particular

year was to be allocated to cover the losses generated earlier. So there was no ground to pay

dividends. It should also be noted that all shareholders, including the Plaintiffs, made obligations

to the credit institutions not to adopt resolutions on the payment of dividends. This is intended to

secure loans granted to subsidiary companies. Therefore the Plaintiffs now cannot accuse the

Company ofunlawful depriving them oftheir dividends.

In the opinion ofthe Court the matter of Jan Domanus' dividend, if any, which according

to the Company was a loan, is also not a reason for dissolution,. It should be noted that the parties

have not submitted any document confirming the transfer of money. Thus, the Court was unable

to evaluate on its own the true nature of the transfer of these funds. Nevertheless, from the

resolutions adopted by all the shareholders, as well as from other documents it arises that the

Company was holding up payment of dividends. Because it initially generated losses, which in

the later years were covered by the profits generated by the Company. In addition the

shareholders agreed not to take resolutions on payment of dividends in connection with securities

for the loans granted to "subsidiary companies". So in the light of the circumstances described

above, it should have been assumed that the money given to Jan Domanus was not a dividend.

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Moreover, in the Court's opinion, even if one assumes that Jan Domanus received a

dividend, this would not constitute the basis for dissolving the Company. This issue should be

resolved between the shareholders, and not in the proceedings against the Company. It should be

noted that the accusation ofpaying the dividend was raised by one ofthe Plaintiffs A. Kozlowski,

acting in the proceedingjointly with the beneficiary ofthe payment J. Domanus, together turning

it in to as an accusation against the Company.

In the Court's opinion, also the allegation that the Plaintiffs cannot exercise their rights as

shareholders, including being left without access to documents of the Company, turned out to be

irrelevant. As it is elear from the letters included on the pages from 247 to 279, representative of

the minority shareholders had an opportunity to examine the Company's documents after he

delivered original powers ofattorney. The Parties had a problem with finding an appropriate time

to meet and examine the documents, but it cannot be considered as avoided by the Defendant

Company's default. In addition, the Defendant Company provided possibility of making the

company's documents available only to the shareholders acting personally, and not by their

attorney. It also did not consent for copying the documents. This cannot be regarded as a sign of

bad will on the part of the Company. Specified decisions should be considered as rational and

taken in the interest of the Company itself. In addition, the attorney of the Plaintiffs fai led to

appear at the date and time indicated for access to the Company's documents. It should also be

noted that the PlaintiffIzabela Kozlowski, during questioning at the hearing in course ofthe court

suit, said that the Company had made the documentation available to her and she was able to

inspect it.

In the opinion of the Court the fact that at present a criminal investigation against Adam

Swiech is in progres s in respect to criminal offences committed with the use of organizational

structure of Krakow Business Park Ltd., does not constitute grounds for the dissolution of the

Company. The above is not an evidence for stating that the majority shareholder acted without

knowledge and to the detriment of the minority shareholders. Only a final and binding judgment

convicting him would eonfirm the guilt of Adam Swiech. Prior anticipation of the final outcome

of the criminal proceedings against a majority shareholder would violate constitutional

guarantees. One cannot make a presumption that, if criminal proceedings are conducted against

the majority shareholder, then the actions taken by him were to the detriment of Plaintiffs. The

more so because, in the opinion ofthe Court, alI the members concordantly worked together until

2008, adopting unanimous resolutions and approving the financial statements and the work ofthe

Board.

The fact that the District Attorney in Krakow established security interest on the shares of

Adam Swiech in Krakow Business Park Ltd. is irrelevant to the Company's operations. Adam

Swiech in fact may exercise, directly or through an attorney, the powers in respect of the shares

hel d, including the right to vote. This is demonstrated, inter alia, by the fact that the majority

shareholder was authorized by the District Court to convey Extraordinary Meeting of

Shareholders.

The Plaintiffs did not prove that Adam Swiech falsified the minutes of the shareholders'

meeting held in March 2008 and the attendance list. References made in the course of this hearing

by the Plaintiffs to the expert's opinion drawn up in the preparatory proceedings is not sufficient

for a positive resolution ofthe aforementioned issue in this proceeding.

It should also be noted that is incurring legal costs is a naturaI consequence of

participating in litigation. These costs are higher if the proceedings are taking place abroad. So

allegations should not be made against the Defendant Company, that it pays to USA attorneys,

who represent it before a court in the United States.

The fact that there is a conflict between the partners is undisputed. However, in the

opinion of the Court the conflict is present from mid-2008, and despite it Krakow Business Park

Ltd. is still operating. It is worth pointing out that in course ofthis proceeding the Plaintiffs filed

a motion - withdrawal of the action. It is true that the Plaintiffs withdrew that motion, but the

Plaintiffs were not able to explain to the Court the circumstances, in which they made such

important decisions. In the opinion of the Court this is yet another indication that the Plaintiffs

continuing the case put pressure on the incidental intervener in order to obtain a more favorable

price for their shares. When trying to persuade the parties to reach a settlement the Court received

information that the dispute boils down to the value, which the Plaintiffs would like to receive as

a settlement oftheir contributions, and the incidental intervener would not accept this value.

For the aforementioned reasons, the Court found no basis for dissolution ofthe Company.

The costs ofthe proceedings where decided pursuant to Article 98 ofthe Civil Code, according to

the principle of responsibility for the outcome of the process. Amount of granted expenses

includes the Defendant's attorney's fee and the incidental intervener separately, at the minimum

rates provided for in the Regulation of the Minister of Justice for the reimbursement of incurred

costs and expenses. The items that make up the granted expenses are calculated in the same way

as in the justification to the decision to discontinue, page 2090 binder X

SealoJDistrict Courtin Krakow

[StampJ: appropriate signatures ajjixed on the originalCertified true copyMalgorzata Wegrzyn, Senior Clerk

I, Jacek Stępak, registered on the Minister of Justice's List of Certified Translatorsunder the number TP/2969/05, hereby certify that I verified submitted translationinto English and I found its content to be compliant with the content of the documentwritten in Polish. The document consists of 56,287 characters, which constitutes 50pages of certified translation (§ 8; Minister of Justice's Regulation of 24 January2005).

Krakow, 15 March 2013. Number in the Repertory: 117/2013.

november 22, 2012 poland, kraków

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