Tallinna Börs                 NEWS RELEASE                      05/31/2004



COMMITTEE'S DECISION ON KALEV



At the request of AS Milestone, a shareholder of AS Kalev, the extraordinary 

general meeting of shareholders of AS Kalev held on 4 March 2003 decided 

to conduct a special audit in order to identify any damage relating to the 

management and financial status of AS Kalev. A summary of the special 

audit report was read out at the annual general meeting of shareholders of 

AS Kalev on 14 December 2003. On 15 December 2003, AS Kalev published 

a stock exchange announcement in which it stated alongside the resolutions 

of the general meeting of shareholders that the special audit results did not 

indicate any particular damage to AS Kalev. AS Kalev has not published the 

special audit report or a summary containing important information via the 

information system of the Stock Exchange.



On 13 May 2004, AS Kalev submitted an application to the Stock Exchange 

for making an exception, in which it asked to grant an exception to AS 

Kalev on the basis of § 287 (2) of the Commercial Code and clause 2.1.4 of 

the RI, and not to demand the publication of the special audit results via 

the information system of the Stock Exchange. According to the assessment of 

Kalev, the special audit report contains amongst other things the company’s 

business secret, the disclosure of which may damage the interests of the 

company.



Considering the materials submitted, having reviewed the explanations 

given by the representatives of Kalev, and proceeding from the provisions 

of the TSE Rules, the TSE Listing and Surveillance Committee decided on 25 

May 2004 to grant an exception to AS Kalev from the publication of the full 

special audit report via the information system of the Stock Exchange, but 

to oblige AS Kalev to publish a summary of the material conclusions of the 

special audit report via the information system of the Stock Exchange by 1 

June 2004 at the latest.





The Listing and Surveillance Committee also found that AS Kalev had not 

published the material conclusions of the special audit report on which basis 

AS Kalev stated via the information system of the Stock Exchange that the 

special audit report did not indicate any damage. Neither has AS Kalev 

published the important information subject to disclosure to the 

shareholders to all the shareholders simultaneously and on equal conditions.



Therefore, the Listing and Surveillance Committee found that AS Kalev did 

not meet its obligations under clauses 1.2.2, 1.2.3, 2.1.1, 2.4.1, 6.1, 

6.1.7, and 3.5.1 of the RI in full. According to the assessment of the 

Committee, Kalev has violated the obligations set out in the RI, which oblige 

an issuer to publish correct, accurate and unambiguous information, whose 

content must not be misleading and which must not exclude or omit anything 

that may influence the substance or meaning of the information presented also 

about such other material circumstances relating to the issuer which are not 

expressly stated in the RI requirements, but which are not public knowledge 

and which may, by virtue of their effect on the issuer’s assets, liabilities, 

operations or reputation, affect the price of the listed securities.



When assessing the aforementioned circumstances, the Committee considered 

the fact that AS Kalev had applied to the Listing and Surveillance 

Committee for an exception from the publication of the said information, 

and reasoned its suspicion about the potential damage that may arise from 

the publication of the information.



Based on the above and proceeding from the provisions of the TSE Rules, 

the TSE Listing and Surveillance Committee decided to give AS Kalev a 

warning for the violation of clauses 1.2.2, 1.2.3, 2.1.1, 2.4.1, 6.1, 6.1.7, 

and 3.5.1 of the RI.





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