Appeninn Vagyonkezelo Nyilvanosan Mukodo Reszvenytarsasag : Felelős Társaságirányítási jelentés Corporate Governance Report and Management Liability

Corporate Governance Report and Management Liability

Appeninn Vagyonkezelő Holding Nyilvánosan Működő Részvénytársaság1 (registered office: 1118 Budapest, Kelenhegyi út 43. B. ép. 5. em. 1., company registration number: 01-10- 046538; hereinafter referred to as: "Company"), shall report its corporate governance practice employed in the business year of 2020 in relation corporate governance.

The corporate governance principles are to be employed in relation to the subsidiary companies owned by the Company.

1.) Brief description of the board of directors, presentation of the division of liabilities and tasks between the board of directors and the management

The management body of the Company - in place of the Directorate and the Supervisory Board - is the Board of Directors, acting as a one-tier management system, and consisting of five natural person members. The members of the Board of Directors shall designate one chairperson among themselves by means of simple majority.

The Board of Directors meets as required, but at least once every three months. The meeting of the Board of Directors is to be held at a time defined on the previous meeting, in the absence of the hereof, such a meeting is deemed to be convened within 3 months as of the day of the previous meeting.

The meeting of the Board of Directors is convened by the Chairperson of the Board of Directors, and in case of obstruction of the Chairperson, two members of the Board of Directors, jointly, shall convene the said meeting.

The meeting shall be announced in writing, at least 8 days prior to the date of the start - indicating the agenda item, the site and the time - by means of an invitation letter addressed to the members of the Board of Directors, and sent via ordinary post, or fax, or e-mail. Along with the agenda items, the detailed written submissions and draft resolutions making the decision-making possible and related to each agenda item shall be respectively sent.

Any member of the Board of Directors may request the convocation of the Board of Directors in writing, stating the reason and the purpose. In such cases, the Chairperson is obliged to convene the meeting of the Board of Directors within 15 days following the receipt of the aforesaid written request. To the extent that the Chairperson does not perform such request within 5 days following the receipt of the thereof request, then any member of the Board of Directors shall convene the meeting directly.

The meeting of the Board of Directors shall be accordingly held without convocation if all and each member(s) of the Board of Directors are/is present.

The meeting of the Board of Directors is considered to have a quorum, if there is at a minimum of 3 members are present.

The resolutions of the Board of Directors is to be made by simple majority of the votes, and in case of a tied vote the Chairperson of the meeting shall have a casting vote. The Board of Directors

- to the extent that the decision on the matter is important and urgent - shall make a resolution other than in an ordinary meeting. In the hereinabove case, the prevailing quorum shall be deemed

1 in English: Appeninn Asset Management Holding Public Limited Company

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upon taking the total number of the members of the Board of Directors into account.

The members of the Board of Directors shall cast their votes in writing by means of a singed fax- message or a signed document scanned or attached to the e-mail, or regarding the case of personal delivery, an original signed document (adoption, refusal, abstention).

The acceptor vote shall unambiguously involve the reference to the decision options potentially included in the draft resolution. The members of the Board of Directors shall exclusively vote on the textual proposals included in the draft resolution. To the extent that the vote contains a condition or a different proposal then the said vote is considered to be a refusal.

With regard to each and all case(s), the members of the Board of Directors shall certify their votes by their votes equivalent with their signature indicated on their certified signature registration card or their signature included on their signature sample countersigned by an attorney-at-law.

To the extent that none of the proposed draft gains the necessary number of supporting proposals, then the issue shall be included in the agenda item of the subsequent body meeting.

The members of the Board of Directors are to be informed by the Chairperson of the Board of Directors on the results developed in the course of the extraordinary resolution making within 3 working days following the time limit for votes past due upon sending the minutes on the votes and the resolution made in writing.

The rules of procedures of the Board of Directors shall include the tasks in details regarding the competence of the Board of Directors. The work organisation of the Company is led by the Board of Directors.

The General Meeting of the Company held on 14 October 2019 made decision on establishing the post of the chief executive officer entitled to independent representation and authorized signature rights in the interest of promoting the effective and daily operation of the Company. The aforementioned Chief Executive Officer of the Company is designated by the Board of Directors as of 30 September 2020. The Chief Executive Officer shall hereby perform its tasks upon employment relationship. It is the Board of Directors who is entitled to practice employer's rights over the Chief Executive Officer. The Chief Executive Officer shall also be the member of the Board of Directors. Decision-making on matters not belonging to the exclusive competence of the General Meeting or the Board of Directors is referred to the competence of the Chief Executive Officer. The Chief Executive Officer exercises the employer's rights over the employees of the Company.

The operation of the Board of Directors was not obstructed by the cases of emergency announced on account of COVID 19 in 2020, the meetings of the Board of Directors were held by personal attendance and by employing electronic communications equipment.

2. Introduction of the members of the Directorate / the Board of Directors, the Supervisory Board and the management (in the case of board members, including the indication of the independence status of each member), description of the structure of the committees.

Dr. Bihari Tamás, the Chairperson of the Board of Directors and the Chief Executive Director of the Company

Dr. Bihari Tamás was graduated at University of Pécs, Faculty of Law. In recent years, he has been

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performing legal executive tasks, especially in the areas of IT industry. In the course of his work, he gained significant experience in the areas of acquisition, administration and support-funded projects, and respectively, areas related to legal and financing areas of the thereto.

Recently, he worked for an international multinational company, at the Hungarian centre of Novell, and later, in 2019, he joined to 4iG Plc., also a participant in the said industry, as a legal director. Regarding the company, among others, he participated in drafting the legal background regarding the internal organisation development and in acquisitions concerning the areas of IT. He is a lecturer at Budapest Metropolitan University. He speaks in English, German and French.

Dr. Szabó Nóra,a member of the Board of Directors and the Chief Legal Officer of the Company

Dr. Szabó Nóra was graduated at College of Public Administration as an administration manager in 1997, and later, in 2005, she was graduated at Eötvös Lóránd University, Faculty of Law. She was working for a law office from 2006 to 2010 and afterwards she was a private lawyer. From 2017 to 2019 she gained experience as legal and compliance director at Magyar Fejlesztési Bank Zrt.2 (MFB). Between 2017 and 2018 she was the Chairperson of the MFB Invest Plc. Directorate, and later, from 2018 to 2019, the member of the Supervisory Board, and, moreover, between 2018 and 2019, the member of the Board of Directors of Budapest Bank. As of 2019, she is the legal director and the member of the Board of Directors of Appeninn Plc.

Nemes István Róbert, an independent member of the Board of Directors and the Chairperson of the Audit Committee

Nemes István Róbert was graduated at Budapest University of Economic Sciences and Public Administration as an economist. After the chartered accountant qualification, he passed ACCA degree in 2014. He has gained experience in the fields of building industry for almost 20 years, both in the areas of construction and complex real estate developments. Following his university studies, he performed middle and top management positions at significant Hungarian building industry companies, and since 2007 he has been the financial manager at Bayer Group coordinating the financial processes of the corporate group. He speaks in English and German.

Dr. Hegelsberger Zoltán - independent member of the Board of Directors and member of the Audit Committee

Dr. Hegelsberger Zoltán was graduated at Eötvös Loránd University, Faculty of Law and Political Sciences, and later, he also participated at ELTE Institute for Postgraduate Legal Studies, graduating as a specialist lawyer in "Europe Law". In addition to his legal activities, he also performed executive officer positions and undertook membership in the supervisory board in many prominent national companies. In recent years he supported Bayer Group as a legal manager in relation to many significant projects of investments and real estate developments in the areas of building industry of significant importance performed by the corporate group.

Kertai Zsolt - independent member of the Board of Directors and member of the Audit Committee

Kertai Zsolt was graduated as an economist at Commerce, Catering and Tourism College in 1997,

2 in English: Hungarian Development Bank Private Limited Company

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and later, in 1999 he started his career at Plaza Centers. He was the director of Csepel Plaza until 2004, and until 2006 he was the regional director at Csepel and Duna Plaza being responsible for operation and rental. As of 2006, when Plaza Centers were taken over by the French Klepierre, he continued his career as a development director in Hungary, among others, he managed Corvin Plaza investment. As of 2012, he managed rental activities of 16 Hungarian shopping centers as a commercial director, and later, in 2013, he was asked for the position of the manager director, and he held the thereof position up to 2019.

Zágonyi Ádám - Chief Financial Officer of the Company

In addition to his Master degree in economics specialised in audit at Budapest Corvinus University, Faculty of Economics, Zágonyi Ádám also holds the internationally accredited CEFA degree of European Federation for Financial Analysts Societies. He started work at the Financial Infrastructure Directorate of the Hungarian National Bank in 2012, and from 2014, in the Ministry of National Economy, he was mainly working on the regulatory aspects of the IFRS transformation. From 2015, he returned to the Hungarian National Bank, where the estimation of the impacts of the IFRS transformation with regard to the banks as well as the analyses of the liquidity of the banking system were his main duties. As of 2019, he was responsible for the digital development of the national financial system. He has been the Chief Financial Officer of the Company as of May 2020.

Vörös Gábor - Sales Manager of the Company

Vörös Gábor was graduated at Szent István University in 2000 as an economic engineer, and he also obtained financial and banking qualifications. He has been gaining professional experience in the areas of real estate property, firstly at IGN Zrt., and later, as of 2004, he held a position of Director of Real Estate Property Management at Indotek Group, and at its subsidiary company, In-Management Kft. He has been the manager responsible for sales as of the third quarter of 2020 at Appeninn Plc.

2.1. Members of the Board of Directors (01 January 2020 - 31 December 2020)

A Board of Directors of five members is operating at the Company, and members of the thereof are elected by the members of the General Meeting.

• Bernáth Tamás - member of the Board of Directors, the Chairperson of the Board of Directors (as of 23 April 2019), and the Chief Executive Officer (from 14 October 2019 to 30 September 2020), a non- independent member of the Board of Directors
• Dr. Szabó Nóra - member of the Board of Directors, non-independentmember of the Board of Directors (as of 14 October 2019)
• Dr. Tóth Judit - member of the Board of Directors, independent member of the Board of Directors (from 23 August 2018 to 30 September 2020)
• Malik Zoltán - member of the Board of Directors, independent member of the Board of Directors (from 23 August 2018 to 30 September 2020)
• Guttmann György Vilmos - member of the Board of Directors, independent member of the Board of Directors (from 14 October 2019 to 30 September 2020)

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• Dr. Bihari Tamás - Chairperson of the Board of Directors (as of 30 September 2020), Chief Executive Officer, non-independent member of the Board of Directors
• Dr. Hegelsberger Zoltán - member of the Board of Directors (as of 30 September 2020), independent member of the Board of Directors
• Kertai Zsolt - member of the Board of Directors (as of 30 September 2020), independent member of the Board of Directors
• Nemes István Róbert - member of the Board of Directors (as of 30 September 2020), independent member of the Board of Directors

2.2. Audit Committee (01 January 2020 - 31 December 2020)

An Audit Committee of three members is operating at the Company, and the members of the thereof are elected by the members of the General Meeting.

The Audit Committee:

• Dr. Tóth Judit - member of the Audit Committee (from 23 August 2018 to 30 September 2020)
• Malik Zoltán - member of the Audit Committee (from 23 August 2018 to 30 September 2020)
• Guttmann György Vilmos - member of the Audit Committee (from 14 October 2019 to 30 September 2020)
• Dr. Hegelsberger Zoltán - member of the Audit Committee (as of 30 September 2020)
• Nemes István Róbert - member of the Audit Committee (as of 30 September 2020)
• Kertai Zsolt - member of the Audit Committee (as of 30 September 2020)

Following the appointment of the thereof members of the Audit Committee, they received an extensive information on the accounting, financial and operational peculiarities of the Company.

The members of the Audit Committee have the necessary expertise to perform duly their duties and hold the relevant financial and accounting background and experience related to the current subject. In order to perform the aforesaid duties, the Audit Committee shall receive accurate and detailed information about the Auditor's work program; and shall receive a report of the Auditor on issues identified during the audit.

2.3. The Members of the Management

Bernáth Tamás - Chief Executive Officer (from 14 October 2019 to 30 September 2020)

Dr. Bihari Tamás - Chief Executive Officer (as of 30 September 2020)

Bujdosó Péter - Chief Financial Officer (from 01 August 2019 to 04 June 2020)

Zágonyi Ádám - Chief Financial Officer (as of 16 May 2020)

Dr. Szabó Nóra - Chief Legal Officer (as of 16 July 2019)

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