1. Transactions with the property and valuation



The property was sold by bank "Latvijas Krājbanka", to whom "Kaija" had

pledged it as a collateral for loan, in December of 2003, at book value

and  without  any auction, to company "JS īpašumi" (reg. No.000364434).

The  book  value  of the property was LVL 1, 626, 924. The property was

valuated  by   SIA  "Vindeks"  (reg.  No.40003562948). This company has

valuated  "Kaija"  properties  already  several times, and was selected

upon  the recommendation of "Latvijas Krājbanka". Please find a copy of

the evaluation document appended.

 2. Paying for the purchase



Pursuant  to the provisions of Agreement, the buyer transfers the money

for the purchase to "Latvijas Krājbanka" account:



1.       LVL  880,818  - to cover the liability to "Latvijas Krājbanka"

(pursuant to the loan agreement). Payment transferred.



2.       LVL  77,182  -  costs associated with the property - technical

inspection,  property  tax,  public  utilities  costs, wages to "Kaija"

employees. Payment transferred.



3.       LVL  115,000 to pay off the liabilities to creditors, pursuant

to the court verdict. Payment transferred.



4.       LVL  40,000  - costs associated with the deal - signing of the

purchase  agreement, certifying, registration at the Land Book. Payment

transferred.



5.       LVL  500,000  -  to be transferred to JSC "Kaija" account with

"Parekss  banka",  and  to be used to pay for the supplies etc. Payment

transferred.

 3. Legal relationship with the new owners



Neither  "Kaija" nor its officials have ever had any legal relationship

with Jānis Smagars and Raivo Kallions.



Oskars  Punenovs  was  employed  by  the  company  from 17.02.2003 till

09.01.2004 in the capacity of procurement manager.

 4. Pledged property



Currently "Kaija" owns property located at:



a. land at Atlantijas iela 7, Riga, cadaster No.0100 11 0747.

b. land at Atlantijas iela, Riga, cadaster No.0100 111 0880



The  book value of this property is LVL 33,081. The property is pledged

to the benefit of "Latvijas Krājbanka", as a part of the collateral for

credit  line  USD  185,000,  and  right now is arrested on the basis of

bailiff's verdict.

 5. Facility lease terms and conditions.



JSC "Kaija" leases the premises from "IP Vecmīlgrāvis", and the rent is

LVL 12,062 per month, including 18% VAT. The cost per sqm is not higher

than 0.50. The lease agreement may be terminated:



a)     upon mutual agreement of the parties;



b)     without prior warning - in case the tenant:



·          uses  the  rented  space  for  purposes not specified in the

agreement



·         has incurred damages to the rented space



·         delays the rent payment for more than 1 month



c)     in case a party becomes insolvent.



7. Implementation of SAPARD



"Latvijas  Krājbanka"  has  promised  a  financial  support  if "Kaija"

project receives funding from SAPARD.



8. Requested documents



All decisions have been taken at joint Supervisory Board and Management

Board  meetings  with  unanimous  affirmative  vote  - according to the

provisions  of  the  Charter. Also "Latvijas Krājbanka" representatives

are  members  of  the  Management  Board,  and  any decisions regarding

property  transfer  and  restructuring  have been approved by "Latvijas

Krājbanka" Management Board as well. The excerpts from the minutes will

be provided in the nearest future.



2003  financial statements are under preparation. "Kaija" is submitting

the balance sheet.



-   P&Land balance sheet (in Latvian)_2003.pdf (147.78 KB)