Kalev                         NEWS RELEASE                      12/17/2003



THE DECISIONS OF THE SHAREHOLDERS' GM



At December 14 AS Kalev ordinary

general meeting of the shareholders, 84.3242% of

the company’s share capital was represented, thus

constituting a quorum. Tallinn notary Aivar

Mesikäpp, who attended, attested to the plenary

meeting’s right of decision.



AS Milestone, 23.24% owner of AS Kalev, desired to

change the meeting agenda by omitting one

proposal, on the matter of a claim to be made

against AS Milestone. 71.984% of the votes were

against omitting the proposal.  Thus the meeting

agenda proceeded as in the official notice on the

meeting of the shareholders published in the

Postimees daily on November 22, 2003.





Decisions of the ordinary general meeting of the

shareholders.



1. It was decided to agree to the submission of a

claim against shareholder AS Milestone demanding

compensation from them and seeking an end to

activities violating the principles of fair

competition, good practice and good faith.  It was

decided to appoint Allan Viirma as representative

of AS Kalev, who has the right of sub-delegation.



AS Kalev found that AS Milestone is exerting

unfair competition, publishing misinformation in

the press claiming that AS Kalev lacks

administrative bodies as provided by legal acts.

With such claims, shareholder AS Milestone has

called into question all of AS Kalev’s activity,

while on the other hand no decision of the

directorship has been declared illegal. The

minutes of general meetings in which the

Supervisory Board was elected have been confirmed

by a notary, who also testified that the quorum

was attained.



The directorship of AS Kalev is obligated to

represent and direct the company. In this

connection they have the right to require

shareholders not to impede day-to-day economic

operations by publishing misleading information

resulting in damage to AS Kalev’s name and

economic interests.



Due to the unjustified suits brought in Tallinn

City Court against AS Kalev by Millstone, it was

more difficult for AS Kalev to get finances from

credit institutions in order to furnish its new

factory with equipment.



In addition, a company connected with shareholder

AS Milestone introduced products under its brand

name that competed with AS Kalev: candies,

cookies, gingerbread.



2. AS Milestone representative Priit Kotkas

proposed to recall the members of the Supervisory

Board of AS Kalev Ülo Suurkask and Kristel Soll

and to select Erki Mölder and Üllar Udras as new

members of the Supervisory Board for a term of

five years.



Supervisory Board members Ülo Suurkask and Kristel

Soll were not recalled, since 78.999% and 71.995%

of votes opposed the recall, respectively.



The meeting did not deem it necessary to select

new Supervisory Board members.





3. AS Kalev’s annual report covering 1 July 2002

to 30 June 2003 was confirmed.



4. It was decided to allocate the net profit for,

2002/2003 (32,462,673 kroons) as follows:



-  increase the mandatory reserve by 1,537,837

kroons;

- enter the remaining profit in the amount of

30,924,836 kroons under "Retained earnings".





5. Heino Priimägi, Chairman of the Supervisory

Board of AS Kalev, presented to shareholders a

report on the findings of a special audit

conducted by PricewaterhouseCoopers. AS Kalev

shareholders duly took note of the information.



4.03.2003. On the basis of a decision of the

general meeting of the shareholders,

PricewaterhouseCoopers conducted a special audit

in the following transactions:



a) circumstances connected with the conclusion

of a leasing agreement for Paide Piimakombinaat’s

equipment and real estate;

b)  Fulfilment of obligations arising from a

surety agreement signed to guarantee loan(s) taken

by ETFC Group;

c) AS Kalev’s transactions with Rein Kaseleht,

Tiit Kõuhkna and Toomas Kõuhkna;

d) AS Kalev’s transactions with Tööstuse

Teenindamise AS;

e) AS Kalev transactions arising from

cooperation and/or sponsorship agreements with the

Estonian Olympic Committee, Estonian Handball

Association and OÜ Gunnar Klettenberg;

f) Transactions connected with purchasing of

horse trailers by AS Kalev.



The special audit findings did not reveal that any

concrete damages had been caused.



6. It was decided not to increase share capital

via bonus issue.



7.  It was decided to amend the Articles of

Association of AS Kalev as follows, and establish

it in the following phrasing:



-Clause 1.2 of Section 1, BUSINESS NAME AND

LOCATION, was phrased as follows:

"1.2. The location of the association is Rae

Parish, Harju County."



- to add subsection h) to Clause 2.1 of Section 2,

FIELD OF ACTIVITY, as follows:

" h) manufacturing of foodstuffs"





AS Milestone representative Priit Kotkas made a

proposal to amend the Articles of Association of

AS Kalev as follows:



-  amend Clause 6.5 of the Articles of

Association and phrase it as follows:

  

"The general meeting may adopt decisions if at

least 4/5 of the votes represented by shares are

present, provided that a greater majority

requirement is not established by legal acts or

the Articles of Association"



- amend Clause 6.6 of the statute and phrase it

as follows:

  

"A decision of the general meeting shall be deemed

adopted if at least 4/5 of the votes represented

by shares have been cast in its favour, provided a

greater majority requirement is not provided by

legal acts or the statute."



The amendments in question were not deemed

necessary by AS Kalev shareholders to be inserted

in the company’s Articles of Association.



8. It was decided to select

PricewaterhouseCoopers, registry code 10142876,

location Pärnu mnt 15, Tallinn, as AS Kalev’s

auditor. Remuneration will be paid to the auditor

on the basis of an agreement to be concluded with

PricewaterhouseCoopers.



AS Milestone representative Priit Kotkas proposed

to select, as AS Kalev auditor, Mati Nõmmiste,

from the audit firm Rimess MRI OÜ. The proposal

was not approved by the AS Kalev shareholders.





Ruth Roht

PR manager

6 283 858