AGM 2012

Resolutions of AGM

Today, on 3 May 2012 starting at 10 a.m., the annual general meeting of the shareholders of AS Harju Elekter was held at Keskväljak 12, Keila. The AGM was attended by 101 shareholders and their authorised representatives who represented the total of 12,786,342 votes accounting for 76.11 % of the total votes.

The agenda of the general meeting was as follows:
1. Approval to AS Harju Elekter annual report of 2011;
2. Approval to profit distribution;
3. Approval of the composition and remuneration of the Supervisory Board;
4. Appointment and remuneration of auditors;
5. Increasing the share capital;
6. Planning of a share option.

1. Approval to AS Harju Elekter annual report of the year 2011

The general meeting resolved:
To approve the annual report of AS Harju Elekter of 2011, prepared by the management board and approved by the supervisory board, according to which the consolidated balance sheet total of AS Harju Elekter was 52,920 thousand euros as of 31.12.2011, while the turnover of the financial year was 46,674 thousand euros and net profit 2,773 thousand euros.

The number of the votes given in favor of the resolution was 12,754,368 which accounted for 99.75 % of the voted participants.

2. Approval to profit distribution

The general meeting resolved:
To approve the profit distribution proposal of AS Harju Elekter of 2011 as presented by the management board and as approved by the supervisory board as follows:

retained profit from previous periods on 31.12.2011 9,899 thousand euros
total net profit of the financial year 2,773 thousand euros
total retained profit on 31.12.2011 12,672 thousand euros

Management board’s proposal for the distribution of profit as follows:

dividends (0,07 euros per share*) 1,176 thousand euros
increase of reserves 103 thousand euros
balance carried forward after profit distribution 11,393 thousand euros

The dividends will be paid to the shareholders on 22 May 2012 by a transfer to the bank account of the shareholder. * The shareholders registered in the shareholders’ registry on 17 May 2012 at 23.59 shall be entitled to dividend.

The number of the votes given in favor of the resolution was 12,765,768 which accounted for 99.84 % of the voted participants.

3. Approval of the composition and remuneration of the Supervisory Board

The general meeting resolved:

3.1 To appoint a five-member Supervisory Board for the company for the next five years and to determine the remuneration of the Supervisory Board member of the company in the amount of 750 euros per month and the remuneration of the chairman of the Supervisory Board in the amount of 1,600 euros per month. To apply a valid bonus system to the member of the supervisory board who is working in executive management.

The number of the votes given in favor of the resolution was 12,321,585 which accounted for 96.37 % of the voted participants.

3.2 To elect following persons as members of the Supervisory Board: Mr Endel Palla, Mr Madis Talgre, Mr Andres Toome, Mr Ain Kabal and Mrs Triinu Tombak. Mandate enters into force date of this decision.

The general meeting resolved:

To elect Mr Ain Kabal as a member of the Supervisory Board.

The number of the votes given in favor of the resolution was 12,749,115 which accounted for 99.71 % of the voted participants.

The general meeting resolved:

To elect Mr Endel Palla as a member of the Supervisory Board.

The number of the votes given in favor of the resolution was 11,131,472 which accounted for 87.06 % of the voted participants.

The general meeting resolved:

To elect Mr Madis Talgre as a member of the Supervisory Board.

The number of the votes given in favor of the resolution was 10,721,680 which accounted for 83.85 % of the voted participants.

The general meeting resolved:

To elect Mrs Triinu Tombak as a member of the Supervisory Board.

The number of the votes given in favor of the resolution was 11,182,179 which accounted for 87.45 % of the voted participants.

The general meeting resolved:

To elect Mr Andres Toome as a member of the Supervisory Board.

The number of the votes given in favor of the resolution was 11,071,732 which accounted for 86.59 % of the voted participants.

4. Appointment and remuneration of auditors

The general meeting resolved:

To appoint KPMG Baltics OÜ, register code 10096082 to perform the audit of AS Harju Elekter on the years 2012-2014. Consent obtained. The auditor will be remunerated according to the agreement.

The number of the votes given in favor of the resolution was 12,746,984 which accounted for 99.69 % of the voted participants.

5. Increasing the share capital

The general meeting resolved:

5.1 According to the AGM decision No. 4 from 23 April 2009, to realize the targeted share issue (share option) program, which was directed to the members of the directing bodies and employees of companies within the same group with AS Harju Elekter and the members of the management board of affiliated companies of AS Harju Elekter.

5.2 Increase the share capital by 420,000 (four hundred twenty one thousand) euros up to 12,180,000 (twelve million one hundred and eighty thousand) euros by issuing new shares through monetary contributions.

5.3 Increase the share capital by issuing 600 000 (six hundred thousand) new ordinary shares with nominal value 0.70 euros.

5.4 In accordance with the decision of the AGM No 4 clause 1.5 from 23.4.2009, the issue price of the share is 1.1 euros per share including issue premium in the amount of 0.4 euros.

5.5 In accordance with the decision of the AGM No 4 clause 1.4 from 23.4.2009, the pre-emption of the current shareholders to subscribe for new shares is precluded.

5.6 In accordance with the decision of the AGM No 4 clause 1.7 and 1.8 from 23.4.2009, the right to subscribe for new shares have the persons with whom have been concluded the preliminary contract and which is valid at the time of subscription for shares, taking into consideration the differences in the decision of the AGM No 4 clause 1.8 from 23.4.2009 due to retirement.

5.7 Subscription for the shares to be issued shall be during the time period of 1.-15.6.2012.

5.8 The Management Board sent out the subscription notice to the persons, specified in decision 6, within 10 calendar days after the adoption of this resolution.

5.9 Subscription for the shares shall be taken place at the premises of the Management Board of AS Harju Elekter at the address Paldiski mnt 31, 76606 Keila, on working days from 9-16.

5.10 In accordance with the decision of the AGM No 4 clause 1.9 from 23.4.2009 and with the decision in clause 4 herein, the payment for the shares to be subscribed for shall be made before the subscription by transferring the above mentioned amount to the bank account of AS Harju Elekter, a/c no 221011207998 Swedbank (IBAN EE172200221011207998), presenting upon subscription a payment document, evidencing the payment for the shares to the extent of the shares to be subscribed for.

5.11 In accordance with the decision of the AGM No 4 clause 1.20 from 23.4.2009, new shares shall give the right to receive dividends as of the financial year of 2012.

5.12 Authorize the management board of AS Harju Elekter within 15 days from the end of the subscription period to cancel the shares which have not been subscribed or which have not been paid for at the end of subscription and payment period.

5.13 In accordance with the clause 12 herein, in case of canceling the shares by the management board of AS Harju Elekter, the share capital shall be increased in the amount less of nominal value of the cancelled shares and the number of shares shall be issued in the number less of canceled shares.

The number of the votes given in favor of the resolution was 12,246,640 which accounted for 95.78 % of the voted participants.

6. Planning of a share option

The general meeting resolved:

To carry out the share option in 2015 for the following objectives and on the following conditions which will serve as a basis for adopting a resolution on increasing the share capital and realizing the share option:

6.1 The objective of the stock option is to involve the members of the directing bodies, leading specialists and engineers of companies within the same group with AS Harju Elekter and the members of the management board of affiliated companies of AS Harju Elekter as the shareholders of AS Harju Elekter in order to motivate these persons to make efforts towards achieving better financial results for AS Harju Elekter, thereby ensuring the economic development of the company and involvement of additional funds in the equity capital of AS Harju Elekter and increasing the value of the shares in AS Harju Elekter. The current direct placement cannot be interpreted either as share options or an issue of convertible bonds.

6.2 The amount of the share option is 600 000 (six hundred thousand) ordinary shares or 3.45% of share capital, for which purpose up to 600,000 new registered ordinary shares, each with a nominal value of 0.70 euros, will be issued upon deciding on the increase of the share capital in 2015 in the amount of 420,000 (four hundred and twenty thousand) euros.

6.3 Upon increasing the share capital in 2015, the right of pre-emption of the current shareholders to subscribe for new shares shall be precluded in accordance with the provisions of the Commercial Code § 345 (1).

6.4 The issue price of the new shares to be issued in 2015 is the average price of the share of AS Harju Elekter in euros (EUR) on Tallinn Stock Exchange during the stock exchange days of 01.06.-15.06.2012. A price exceeding the nominal value of 0.7 euros is deemed to be an issue premium. The price which exceeds the nominal value of a share shall be deemed to be an issue premium. To acquire a share, its nominal value and issue premium need to be paid.

6.5 Subscription for the shares to be issued shall be carried out following a decision on increasing the share capital during the time period of 16.06.-30.06.2015

6.6 The right to subscribe for new shares to be issued after the decision of the general meeting of shareholders on the increase of share capital is vested in the persons specified in clause 6.1 hereof with whom a preliminary contract has been concluded by and on behalf of the shareholders, ensuring the pre-emptive right to subscribe for shares (hereinafter: Preliminary Contract) to the extent of the number of shares specified in the Preliminary Contract and on the condition that the Preliminary Contract is valid at the time of subscription for shares.

6.7 For validity of the shares subscription right and the Preliminary Contract, it is required that the persons specified in clause 6.1 hereof have a valid work-related or professional relationship with a company within the same group with AS Harju Elekter or with an affiliate company of AS Harju Elekter until the shares subscription date (inclusive), unless the work-related or professional relationship of the person specified in clause 6.1 hereof expires after the conclusion of the Preliminary Contract in connection with retirement.

6.8 Payment for the shares to be subscribed for shall be made before the subscription, presenting upon subscription a payment document evidencing the payment for the shares to the extent of the shares to be subscribed for.

6.9 To conclude the preliminary contracts, it is necessary to carry out pre-registration of the persons who are interested in the conclusion of preliminary contracts and are specified in clause 6.1 hereof in the period between 07.-18.05.2012, at the premises of the management board of AS Harju Elekter at the address: Paldiski mnt. 31, 76606 KEILA, on working days from 9.00-16.00, or by e-mail with a message to the e-mail address: aktsia@he.ee. Upon pre-registration, the persons specified in clause 6.1 hereof must give notice of their given names and surname, personal ID code, postal address with postal code, communication numbers (phone, fax, e-mail), position or office in the group or an affiliate company, and the number of shares sought to be subscribed for.

6.10 To allow the members of the directing bodies to apply for the subscription right to up to a maximum number of 20,000 shares and leading specialists and engineers to apply for the subscription right up to a maximum numbers of 10,000 shares in AS Harju Elekter. If a person specified in clause 6.1 hereof has a work-related or professional relationship in more than one company within the group of AS Harju Elekter or its affiliate company, the person has the right to conclude only one Preliminary Contract and request on the basis of the Preliminary Contract only once the right to subscribe for 20,000 or 10,000 shares.

6.11 The conclusion of the Preliminary Contracts is to be carried out in the period between 18.06.2012 and 29.06.2012. If during the pre-registration specified in clause 6.9 the persons specified in clause 6.1 hereof express a wish to obtain the subscription right to more than 600,000 shares, the proportion of each new applicant, the subscription right is divided equally between all new applicants. If during the preliminary registration specified in clause 6.9, the persons named in clause 6.1 of the present decision express their wish to obtain the subscription right for a total of fewer than 600,000 shares or if before 31.03.2015, there will be free applications for shares in relation to the expiry of the Preliminary Contract, Preliminary Contracts can be signed for the free number of shares on the terms and conditions specified in the present decision of the general meeting until 31.03.2015 with the persons with whom an employment or professional relationship was created in a company belonging to the same group with AS Harju Elekter as of 01.07.2012 or who was elected as member of board of the affiliated company of AS Harju Elekter as of 01.07.2012.

6.12 To avoid uncovered subscriptions, a person applying for the pre-emptive right to subscribe for shares, must have paid by the date of conclusion of the Preliminary Contract the fee for conclusion of the Preliminary Contract (hereinafter: fee for subscription 2012) in the amount of 0.10 euros for each one (1) share whose subscription is sought, by transferring the said amount to the bank account of ASi Harju Elekter, a/c No 221011207998 Swedbank. The paid amount shall be completed as an interest-free loan to AS Harju Elekter which shall be calculated as a part of the subscription payment or shall be repaid if the shares shall be unsubscribed. The Preliminary contract shall be concluded to ensure the pre-emptive right to subscribe for such a number of shares equal the number of shares for which the fee for the Preliminary Contract has been paid by the date of conclusion of the Preliminary Contract.

6.13 The privilege to subscribe for shares arising from the Preliminary Contract is not tradable, and the rights and obligations arising from the Preliminary Contract cannot be transferred (incl. to bequeath) by the person specified in clause 6.1 hereof to another person. A person who has signed the Preliminary Contract (an investor) has no right to demand from AS Harju Elekter the issue of the shares specified in the Preliminary Contract before the decision of the general meeting of shareholders on the increase of share capital in 2015 and before the subscription of and payment for these shares.

6.14 The shares issued during the increase of the share capital in 2015 gives the right to receive dividends as of the financial year of 2015.

6.15 If at the time of making a resolution on the planned increase of the share capital in 20125 the stock exchange price of a share of AS Harju Elekter is smaller than the price specified in clause 6.4 hereof, the general meeting may suspend the decision on increasing the share capital by 3 years, which will automatically extend the term of the Preliminary Contract by the period decided by the AGM without any special agreement with the persons specified in clause 6.1.

The number of the votes given in favor of the resolution was 11,024,044 which accounted for 86.22 % of the voted participants.

Andres Allikmäe
Managing Director/CEO
Phone +372 674 7400