Turcas Petrol A.Ş. takes into consideration the Company’s Articles of Association,
related laws and regulations and market conditions in deciding dividend distribution. In dividend distribution, the Company’s shareholders’ equity rate, sustainable growth rate, market value and cash flows are taken into account by paying utmost attention to protection of the balance between the investments required for the growth of the Company and the financing of such investments. Within this frame, the Company made up principle the distribution of dividend at the rate, which shall not adversely affect the Company’s market value and shall meet the expectations of the shareholders to the highest level. The “Dividend Policy” is hereby determined by considering the Turkish Commercial Code, Capital Market Law, Regulations and Communiqués and arrangements thereof, tax laws and other legal laws and regulations as well as the Company’s articles of association.

1) Determination of profit
Profit of our Company is the net amount remained after deduction of activity and general management expenses, depreciation and provisions as well as other costs and expenses from income and other incomes generated from the activities set forth in the Articles of Association within a fiscal period. Distribution of the net profit determined by the way so is as follows:

2) Procedure of Dividend Distribution
a. The base of initial legal reserve is the amount remained after deduction of the previous year’s loss, if any, from net period profit (after-tax profit) set forth in the legal records. %5 of the remained net profit is set aside as the Initial Legal Reserve within the framework of Article 466 of the Turkish Commercial Code (TCC).

b. Net distributable period profit is the amount remained after deduction of previous years’ losses and the initial legal reserve from the net period profit (if any). As per Article 4 of the Communiqué Series IV and No. 40 of the Capital Market Board, the initial tier dividend of the Company may not be less than 20% of the distributable profit remained after deduction of legal reserves, required to be set aside as per the laws, funds and financial payments and previous years’ losses (if any). This rate may vary upon the Capital Market Board’s decision of change Upon recommendation of the Board of Directors, the General Assembly may resolve on distribution of the initial legal reserve in cash and/or as shares or on non distribution and retention of the same.

c. Unless the legal reserves obligated to be set aside as per the provisions of the Turkish Commercial Code and the Capital Market Law and the initial legal reserve determined for the shareholders in the Articles of Association are set aside, it shall not be resolved that any other legal reserve be set aside, transferred to the next year and distributed as dividend to the members of the board of directors, employees, servants and workers.

d. Out of the amount remained after distribution of initial tier dividend as per the Company’s Articles of Association, upon the proposal of the Board of Directorsand approval of the General Assembly,
· Any profit share may be distributed to the Members of the Board of Auditors, Personnel or personnel funds,
· Second tier dividend may be distributed to the Shareholders (In this case,
reserve fund is set aside as per Article 466/3 of the Turkish Commercial
Code),
· Or the remaining profit is transferred to the extraordinary reserve funds or is
not distributed partially or entirely for a determined or undetermined period
or may be transferred to a provisional account.
.Out of the amount resolved to be distributed to the shareholders as the second tier legal reserve or distributed to the participants of the profit; 10% is set aside and transferred to the legal reserve fund as per Subparagraph 3 of Paragraph 2 of Article 466 of the Turkish Commercial Code.

3) Other Provisions

· In application of the dividend policy, a stable policy is applicable between the interests of the shareholders and the interests of the Company.

· The General Assembly shall resolve when the dividend is to be distributed to the shareholders upon the proposal of the Board of Directors. However, if the entire of the dividend is to be distributed in cash, best effort is made to ensure that the same shall be paid latest until the end of the 5th month. In case of other distribution methods, the related laws, regulations, communiqués and arrangements of the Capital Market Board shall be applicable.

· The dividend pro rata to the shares is distributed to the existing shares, regardless of the issuance and acquisitions dates thereof, as of the end of the fiscal period without application of principle of per diem deduction.

· In case the calculated “net distributable period profit” remains below 5% of the issued capital, no dividend may be distributed.

· In case of non-distribution of dividend, the Board of Directors submits to the information of the shareholders at the General Assembly why the dividend is not distributed and where the retained profit is used.