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AGM 2008

Extraordinary shareholders’ general meeting 19.02.2008

EXTRAORDINARY SHAREHOLDERS’ GENERAL MEETING 31.10.2008


DECISIONS OF THE GENERAL MEETING OF SHAREHOLDERS

The Annual General Meeting of AS MERKO EHITUS was held on June 3, 2008, and decided:

1. Approval of the Annual Report 2007
To approve the Annual Report 2007 of AS MERKO EHITUS.

2. The decision for the distribution of profits
To approve the net profit of 545 049 316 kroons (34 834 911 euros) for the financial year 2007 and not to distribute it.

3. Approval of the auditor for the financial year 2008
To approve auditing firm AS PricewaterhouseCoopers as the auditor of AS MERKO EHITUS for the financial year 2008. Conducting audit services and payment for services is done on the basis of an agreement with the audit company.

4. Approval of the division plan of AS MERKO EHITUS
To approve the signed and notarized division plan of AS Merko EHITUS of April 30, 2008.

5. Removal and election of the members of Supervisory Board
To recall the members of the Supervisory Board of AS MERKO EHITUS Teet Roopalu, Jaan Mäe, and Toomas Annus; to elect a new Supervisory Board in the following composition: Teet Roopalu, Jaan Mäe, and Tõnu Toomik.

Removal and election of the members of the Supervisory Board shall take effect from the entry in the Commercial Register of the division described in the division plan referred to in clause 4).

6. Remuneration of the members of the Supervisory Board
Pay remuneration to the members of the Supervisory Board under the following new terms:

The members of the Supervisory Board are paid a monthly fee for the performance of their duties: 4,000 (four thousand) kroons to the Chairman of the Supervisory Board, and 3,000 (three thousand) kroons to the members of the Supervisory Board.

The new terms and conditions of remuneration of the members of the Supervisory Board shall enter into force in the Commercial Register as described in the division plan referred to in clause 4 above.

7.Changing the Articles of Association
To amend the Articles of Association of AS MERKO EHITUS as follows:

1) To amend clause 1 and reword it as follows: “The business name of the Company (hereinafter the Company) is the Public Limited Company Järvevana.”

2) To annul clause 3.

3) To amend clause 4 and reword it as follows: “The minimum share capital of the Company is 88,500,000 (eighty-eight million five hundred thousand) kroons and the maximum share capital is 354,000,000 (three hundred and fifty-four million) kroons. Changes in the amount of share capital shall take place pursuant to the procedure provided by law.”

4) To amend the fourth sentence of clause 7 and reword it as follows: “The valuation of the value of non-monetary contributions shall be audited by the auditor unless the object of the non-monetary contribution is securities the evaluation of which special rules are provided in the Commercial Code.”

5) To amend the first sentence of clause 10 and reword it as follows: “A registered share may be pledged.”

6) To amend the first sentence of clause 19 and reword it as follows: ‘The Management Board shall send by registered letter or by letter, fax or electronic means a notice of the General Meeting to shareholders holding registered shares.”

7) To amend clause 21 and reword it as follows: “The General Meeting shall be held at the location of the Company.”

8) To amend clause 27 and reword it as follows: “The Supervisory Board shall provide instructions to the Management Board for the organization of the management of the Company. The consent of the Supervisory Board is necessary for the Management Board to conduct transactions that go beyond the day-to-day business. The consent of the Supervisory Board is necessary for the Management Board to execute transactions if the sum of the values of transactions or transactions executed at a time is more than 200,000 (two hundred thousand) euros; to acquire, dispose of, or terminate an enterprise; and to found and close foreign affiliates.

9) To amend the first sentence of clause 34 and reword it as follows: “No member of the Supervisory Board or any third party may represent the member of the Supervisory Board at the meeting or in the making of the decision.”

10) To amend the second sentence of paragraph 39 and reword it as follows: „If within that period, a member of the Supervisory Board fails to notify whether he/she is in favor of or against the decision, he/she shall be deemed to be against the decision.“

11) To amend clause 42 and to reword it as follows: “The Management Board of the Company has 1 to 3 members. If the Management Board has more than 2 members, the Chairman shall be appointed by the Supervisory Board.”

Amendments to the Articles of Association described in item 7 of the agenda enter into force upon entry in the Commercial Register, the making of which is requested simultaneously with the entry of the division into the Commercial Register in such a way that the entry of division is not made without the entry of amendment of the Articles of Association and vice versa.


NOTICE OF CONVENING OF THE GENERAL MEETING OF SHAREHOLDERS

The Management Board of AS MERKO EHITUS convenes the Annual General Meeting of Shareholders of AS MERKO EHITUS, located at Järvevana tee 9G, Tallinn, 11314, on Tuesday, June 3, 2008, at 13.00, in the conference hall GRANDE 3 (Viru väljak 4, Tallinn) of Hotel Sokos Hotel Viru.

The circle of shareholders entitled to participate in the General Meeting is determined as of May 24, 2008, at 23.59. Registration of participants will start on June 3, 2008, at 12.30.

Agenda of the General Meeting:

1. Approval of the Annual Report 2007
The proposal of the Supervisory Board is to approve the Annual Report 2007 of AS MERKO EHITUS.

2. The decision for the distribution of profits
The proposal of the Supervisory Board is to approve the net profit of 545 049 316 kroons (34 834 911 euros) for the financial year 2007 and not to distribute it.

3. Approval of the auditor for the financial year 2008
The proposal of the Supervisory Board is to approve auditing firm AS PricewaterhouseCoopers as the auditor of AS MERKO EHITUS for the financial year 2008. Conducting audit services and payment for services is done on the basis of an agreement with the audit company.

4. Approval of the division plan of AS MERKO EHITUS
The proposal of the Supervisory Board is to approve the signed and notarized division plan of AS Merko EHITUS of April 30, 2008.

The aim of the division plan is to restructure the Company AS MERKO EHITUS to ensure the sustainable development of the company and to protect the interests of shareholders and employees in the conditions of a long-delayed land swap criminal case. The order of division has been presented in the stock exchange announcement on April 15, 2008, and will be presented at the General Meeting.

5. Removal and election of the members of Supervisory Board
The proposal of the Supervisory Board is to recall the members of the Supervisory Board of AS MERKO EHITUS Teet Roopalu, Jaan Mäe and Toomas Annus; to elect a new Supervisory Board in the following composition: Teet Roopalu, Jaan Mäe, and Tõnu Toomik.

Removal and election of the members of the Supervisory Board shall take effect from the entry in the Commercial Register of the division described in the division plan referred to in clause 4).

6. Remuneration of the members of the Supervisory Board
The proposal of the Supervisory Board is to pay remuneration to the members of the Supervisory Board under the following new terms:

The members of the Supervisory Board are paid a monthly fee for the performance of their duties: 4,000 (four thousand) kroons to the Chairman of the Supervisory Board and 3,000 (three thousand) kroons to the member of the Supervisory Board.

The new terms and conditions of remuneration of the members of the Supervisory Board shall enter into force in the Commercial Register as described in the division plan referred to in clause 4 above.

7. Changing the Articles of Association
The proposal of the Supervisory Board is to amend the Articles of Association of AS MERKO EHITUS as follows:

1) To amend clause 1 and reword it as follows: “The business name of the Company (hereinafter the Company) is the Public Limited Company Järvevana.”

This change is necessary in connection with a change in the business name, as the business name “MERKO EHITUS” is transferred to the company to be acquired in accordance with the division plan described in clause 4.

2) To annul clause 3.

This amendment follows from the amendment to the Commercial Code that came into force on 01.01.2007, according to which the Articles of Association of a Public Limited Company no longer need to include information on the area of activity of a public limited company.

3) To amend clause 4 and reword it as follows: “The minimum share capital of the Company is 88 500 000 (eighty-eight million five hundred thousand) kroons and the maximum share capital is 354 000 000 (three hundred and fifty-four million) kroons. Changes in the amount of share capital shall take place pursuant to the procedure provided by law. ”

This amendment is necessary to increase the limits of the minimum and maximum share capital.

4) To amend the fourth sentence of clause 7 and reword it as follows: “The valuation of the value of a non-monetary contribution shall be audited by the auditor unless the object of the non-monetary contribution is the securities for evaluation of which special rules are provided in the Commercial Code.”

This amendment aligns the wording of the Articles of Association with the regulation on the assessment of non-monetary contribution provided for in the Commercial Code.

5) To amend the first sentence of clause 10 and reword it as follows: “A registered share may be pledged.”

This amendment aligns the wording of the Articles of Association with the regulation of share transactions provided for in the Commercial Code.

6) To amend the first sentence of clause 19 and reword it as follows: “The Management Board shall send by registered letter or by letter, fax or electronic means a notice of the General Meeting to shareholders holding registered shares. ”

This amendment aligns the wording of the Articles of Association with the regulation on forwarding the general meeting notice provided for in the Commercial Code.

7) To amend clause 21 and reword it as follows: “The General Meeting shall be held at the location of the Company.”

This amendment will ensure clarity for shareholders regarding the expected location of the general meeting.

8) To amend clause 27 and reword it as follows: “The Supervisory Board shall provide instructions to the Management Board for the organization of the management of the Company. The consent of the Supervisory Board is necessary for the Management Board to conduct transactions that go beyond the day-to-day business. The consent of the Supervisory Board is necessary for the Management Board to execute transactions if the sum of the values of transactions or transactions executed at a time is more than 200 000 (two hundred thousand) euros; to acquire, dispose of, or terminate an enterprise; and to found and close the foreign affiliates.

This amendment is necessary in order to increase the oversight of transactions by the Management Board with the assets of the public limited company.

9) To amend the first sentence of clause 34 and reword it as follows: “No member of the Supervisory Board or any third party may represent the member of the Supervisory Board at the meeting or in the making of the decision.”

This change corrects a misleading mistake in the Articles of Association.

10) To amend the second sentence of paragraph 39 and reword it as follows: ‘If within that period, a member of the Supervisory Board fails to notify whether he/she is in favor of or against the decision, he/she shall be deemed to vote against the decision.’

This change corrects a misleading mistake in the Articles of Association.

11) To amend clause 42 and to reword it as follows: “The Management Board of the Company has 1 to 3 members. If the Management Board has more than 2 members, the Chairman shall be appointed by the Supervisory Board.”

This change is necessary in connection with changes in the management of the company resulting from the restructuring of the company.

Amendments to the Articles of Association described in item 7 of the agenda enter into force upon entry in the Commercial Register, making of which is requested simultaneously with the entry of the division into the Commercial Register in such a way that the entry of division is not made without the entry of amendment of the Articles of Association and vice versa.

Upon registration, we ask the representative of a legal entity shareholder to provide an extract from the relevant (Commercial) Register where the legal person is registered (a copy of the B registry of the Commercial Register not older than 15 days in case of Estonian legal persons) which results in the person’s right to represent the shareholder (legal right of representation) and representative’s identification document; in the case of a non-legal representative, a duly documented power of attorney (authorization is given by the transaction) and the identity document of the representative must be submitted in addition to the extract from the register. A shareholder who is a natural person is asked to submit a passport or identity card as an identity document; a representative should also submit a duly completed power of attorney.

The documents of a legal person registered in a foreign state (except a power of attorney) must be legalized or certified with an apostille at the Ministry of Foreign Affairs of the Republic of Estonia or at the foreign representation of the Republic of Estonia.

The annual report, the auditor’s report, the draft statutes, the Supervisory Board’s written report on the annual report, the division plan, the reports and activity reports of the last three financial years, the division report, the auditor’s report and the data on the new member candidate for the Supervisory Board are available from 2 May 2008 at a web address https://www.group.merko.ee/. The same documents are available of 2 May 2008 at AS MERKO EHITUS at Järvevana tee 9G, Tallinn, on weekdays from 8:00 to 17:00.

Questions about items on the agenda can be submitted by e-mail merko[A]merko.ee. Questions and answers will be published on the Internet at the website of AS MERKO EHITUS.