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AGM 2005

RESOLUTIONS OF THE ANNUAL GENERAL MEETING

Resolutions of the annual general meeting of AS Merko Ehitus held on 27 April 2005:

I. Approval of Annual Report 2004

Having examined the annual accounts 2004, management report, auditor’s report and profit distribution proposal of AS Merko Ehitus (“the Annual Report”) it was resolved to approve Annual Report 2004 prepared by the Management Board and approved by the Supervisory Board of AS Merko Ehitus.

II. Resolution regarding profit distribution

It was resolved to distribute the profit of AS Merko Ehitus on the basis of the approved annual accounts and in accordance with the profit distribution proposal presented to the general meeting as follows:

(i) to approve the net profit for the financial year 2004 in the amount of EEK 294,599,896 (two hundred and ninety-four million five hundred and ninety-nine thousand eight hundred and ninety-six);

(ii) to pay dividends to shareholders from the net profit of 2004 in the total amount of EEK 57,525,000 (fifty-seven million five hundred and twenty-five thousand), which makes 6 kroons and 50 cents (0.4154 EUR) per share;

all shareholders entered in the share ledger of AS Merko Ehitus as of 11 May 2005 at 8:00 a.m. are entitled to dividends;

the dividends shall be paid to shareholders on 18 May 2005 by remitting the respective amount to the current account tied to the shareholder’s securities account;

(iii) to retain the rest of the net profit undistributed.

III. Appointment of auditor for financial year 2005

It was resolved that in the financial year 2005 the auditor of AS Merko Ehitus will be the auditing company “PricewaterhouseCoopers” and payment for the service will be in accordance with the contract to be entered into with them.

IV. Amendment of Articles of Association

Due to the need to optimise the management of AS Merko Ehitus and to specify the competence of the Management Board and the Supervisory Board it was resolved to approve the new Articles of Association of AS Merko Ehitus in accordance with the draft Articles of Association of AS Merko Ehitus contained in the notice forwarded to the Tallinn Stock Exchange on 30 March 2005.

V. Increase of share capital

Pursuant to § 350 of the Commercial Code and based on the approved Annual Report 2004 of the public limited company, it was resolved to increase the share capital by EEK 88,500,000 (eighty-eight million five hundred thousand) by means of a bonus issue on account of the premium paid in the course of previous share issues (EEK 2,950,000) and the retained earnings of the previous financial years (EEK 85,550,000) and issue 8,850,000 (eight million eight hundred and fifty thousand) new common shares with a nominal value of EEK 10 (ten), whereas:

– as a result of the bonus issue the share capital of the public limited company will increase from EEK 88,500,000 (eighty-eight million five hundred thousand) to EEK 177,000,000 (one hundred and seventy-seven million);
– the increase of share capital will be performed on account of the premium payments made in the course of previous share issues and the retained earnings of previous periods, whereas the shareholders will not subscribe for shares nor make contributions for shares;
– in the course of the bonus issue the shareholding of a shareholder in the share capital will increase in proportion to the nominal value of the shares the shareholder holds;
– as a result of increasing the share capital all shareholders who have been entered in the share register as of 11 May 2005 at 8:00 a.m. will acquire 1 (one) new share for each existing share;
– the shares to be issued shall grant the shareholder the right to receive dividends payable after 01.01.2006;
– the new shares will be registered in the share register not later than within one (1) month after an entry regarding the increase of share capital is made in the commercial register.


ANNUAL GENERAL MEETING OF SHAREHOLDERS

The Board of AS Merko Ehitus announces that the regular general meeting of shareholders of AS Merko Ehitus, located at 9G Järvevana road, Tallinn 11314, takes place on the 27th of April 2005 at 15:00 PM in the “Stuudio I” conference room of the hotel Central at 7c Narva St, Tallinn.

Agenda of the meeting:

1. Approval of the 2004 annual report;
A proposal will be made to the shareholders to approve the annual report of AS Merko Ehitus for 2004.

2. Deciding the profit distribution;
A proposal will be made to the shareholders to approve the following profit distribution proposal:

(i) to approve the net profit of the financial year of 2004 in the amount of 294 599 896 Estonian kroons (EUR 18 828 365);

(ii) to pay dividends to shareholders from the net profit of 2004 in the total amount of 57 525 000 Estonian kroons (EUR 3 676 518), which makes 6 kroons and 50 sents (EUR 0,4154) per share;

all shareholders entered in the share ledger of AS Merko Ehitus as of 11 May 2005 at 8:00 hours a.m. are entitled to dividends;

dividends shall be paid to shareholders on 18 May 2005 by remitting the respective amount to the current account tied to the shareholder’s securities account;

(iii) to maintain the rest of the net profit undivided.

3. Appointment of auditor for financial year of 2005.
The name of the auditing company will be presented at the annual general meeting of shareholders.

4. Amendment of Articles of Association
A proposal will be made to the shareholders to approve the new Articles of Association of AS Merko Ehitus such as set forth in the notice forwarded to the Tallinn Stock Exchange on 30 March 2005.

5. Increase of share capital
(i) Pursuant to § 350 of Estonia’s commercial law and based on the approved annual report 2004 of the public limited company, increase the share capital by EEK 88,500,000 (eighty-eight million five hundred thousand) by means of a bonus issue on account of the premium paid in the course of previous share issues (EEK 2,950,000) and the retained earnings of the previous financial years (EEK 85,550,000) and issue 8,850,000 (eight million eight hundred and fifty thousand) new common shares with a nominal value of EEK 10 (ten), whereas:

– as a result of the bonus issue the share capital of the public limited company will increase from EEK 88,500,000 (eighty-eight million five hundred thousand) to EEK 177,000,000 (one hundred and seventy-seven million);

– the increase of share capital will be performed on account of the premium payments made in the course of previous share issues and the retained earnings of previous periods, whereas the shareholders will not subscribe for shares nor make contributions for shares;

– in the course of the bonus issue the shareholding of a shareholder in the share capital will increase in proportion to the nominal value of the shares the shareholder holds;

– as a result of increasing the share capital all shareholders who have been entered in the share register as of 11 May 2005 at 8.00 a.m. will acquire 1 (one) new share for each existing share;

– the shares to be issued shall grant the shareholder the right to receive dividends payable after 01.01.2006;

– the new shares will be registered in the share register not later than within one (1) month after an entry regarding the increase of share capital is made in the commercial register.

The suffrage of the shareholder at the general meeting will be determined on the basis of the minutes book as of 27.04.2005 at 8:00 AM. The registration of the participants of the meeting will start on the 27th of April 2005 at 14:30 PM.

Upon registration the legitimate representatives of the corporate shareholders are asked to submit the documents, which would approve their right to representation. For the board members of a corporate body it is a copy of the registration card of the company, for the authorized representatives it is the authorization from the board or its substitute and a copy of the registration card of the company. The document for personal identification will be required. The individual shareholders will be asked to submit the document for personal identification, a representative will be asked to submit also the authorization. A passport or other identity document containing the photograph, name, and personal identification code of the person and the name of the state agency having issued the document is acceptable as an identity document.

The annual report 2004 will be available for viewing from the 11th of April 2004 at Internet homepages of Tallinn Stock Exchange (www.ee.omxgroup.com) and Merko Ehitus (www.merkoehitus.ee), and on every workday from 8:00 AM to 5:00 PM at the office of AS Merko Ehitus, 9G Järvevana road, Tallinn.

For any further questions concerning the general meeting, please contact us by telephone +372 6 805 105.