LIFOSA

MATERIAL EVENT



DECISIONS OF THE GENERAL SHAREHOLDERS’ MEETING



The following decisions were taken during an extraordinary general

shareholders’ meeting of AB "Lifosa" on 9 August 2001:

1. To approve the reduction of the authorised capital from LTL 220800000 to

LTL 154560000 executed in the following way:

- to reduce face value of the remaining shares from LTL 20 to LTL 14 per share;

- to leave the unbalanced approximated difference of LTL 2086000 in

unappropriated reserves, which later could be used to cover loss of 2001.

2. To change the by-laws’ items related to the reduction of the authorised

capital.

3. To partly change the time limit of the work of the Management Board.

4. To authorise the Management Board of the company to continue negotiations

regarding terms of agreement on postponement of credit obligations to the

German bank group (Vereinsbank, DG Bank and Comerzbanks) as well as regarding

long-term restructurisation possibilities.

It was decided to consider the issue of mortgaging of assets when a concrete

offer regarding postponement of the agreement is received and a long-term

restucturisation perspective is clear.

5. To authorise Director General to co-ordinate and sign all necessary

agreements in order to acquire part of shares of UAB Transfosa.





Juozas Baniota

Finance Director

(+370 57) 66410