The City of Tallinn and OÜ Utilitas as the shareholders of AS Tallinna Vesi
entered into an agreement on 03/02/2021 (hereinafter the Shareholders Agreement)
which took effect on 31/03/2021. AS Tallinna Vesi joined the Shareholders
Agreement when it came into effect.
Pursuant to the clause 7.8 of "Requirements for Issuers" of the market
regulation of Nasdaq Tallinn, an Issuer is required to ensure that shareholders
holding five per cent (5%) and more of the votes represented by the shares of
the Issuer disclose information, through the Issuer, on all the significant
provisions of all the agreements made with other shareholders or third parties
which are aimed at restricting the free transferability of the shares or which
may have a significant effect on the price of the shares.
Pursuant to the clause 7.9.3 of "Requirements for Issuers", an issuer is obliged
to disclose immediately information about transactions with persons connected
with the Issuer. The information disclosed about such transactions shall
include:
i. information on all the parties to the transaction and their connection
with the Issuer;
ii. a description of the conditions of the transaction and information on the
sum to be received or paid by the Issuer and the due dates of payment;
iii. information on the effect of the transaction on the Issuer's profit,
assets and liabilities;
iv. information on the number of the Issuer's shares held by the connected
person after the transaction, if the substance of the transaction is the
acquisition of a holding from the connected person and the Issuer uses its
own shares to pay for acquiring the holding.
At the time of disclosing this notice, the City of Tallinn holds 10,469,565 A-
shares (i.e. representing 52.35% of the share capital of AS Tallinna Vesi) and
1 B-share in AS Tallinna Vesi (hereinafter also referred to as the Company). OÜ
Utilitas holds 3,530,435 A-shares in the Company (i.e. representing 17.65% of
the share capital of the Company).
The Shareholders Agreement regulates the commercial policy of the Company,
however, the liabilities of the parties arising therefrom are not defined by any
amounts, which renders it impossible to indicate the effect of the Shareholders
Agreement on the profit, assets and liabilities of the Company. The Shareholders
Agreement does not provide for the payment of any specific sums to the Company
or by the Company, and the entry into force of the Shareholders Agreement did
not lead to any change in the number of shares of the Company owned by any of
the parties to the Shareholders Agreement.
* Considering the arrangements for the management of the Company going
forward, we point out the following:
i. it has been agreed that the Supervisory Board of the Company continues
to have nine members. The agreement is that the City of Tallinn shall
be entitled to nominate candidates for four members of the Supervisory
Board (two of them by direct appointment) and OÜ Utilitas shall be
entitled to nominate candidates for three members of the Supervisory
Board (two of them by direct appointment). Two members of the
Supervisory Board continue to be elected from amongst independent
candidates. The Chairman of the Supervisory Board shall be elected from
amongst the Supervisory Board members presented by OÜ Utilitas. The
Vice Chairman of the Supervisory Board shall be elected from amongst
the Supervisory Board members presented by the City of Tallinn.
ii. the Management Board of the Company shall have two to three members. OÜ
Utilitas shall nominate candidates for at least two Management Board
members, and the Chairman of the Management Board shall be elected from
amongst the Management Board members presented by OÜ Utilitas.
* As regards the acquisition and transfer of shares of the Company, the
following has been agreed in the Shareholders Agreement:
i. the Shareholders Agreement does not restrict the right of the City of
Tallinn or OÜ Utilitas to acquire the shares in the Company from
third parties;
ii. the City of Tallinn and OÜ Utilitas may transfer their shares in the
Company only by way of monetary payment, unless otherwise agreed on a
case-by-case basis, or if OÜ Utilitas transfers shares to a connected
person who meets the conditions of the Shareholders Agreement;
iii. the City of Tallinn and OÜ Utilitas are obliged to offer the shares
in the Company, intended to be transferred by themselves, first to
each other for acquisition, unless OÜ Utilitas transfers shares to a
connected person who meets the conditions of the Shareholders
Agreement;
iv. the City of Tallinn may transfer the A shares of the Company in the
amount corresponding to 50% of all A shares of the Company plus
another A share only together and in one block. OÜ Utilitas may
transfer its A shares in the Company, owned by OÜ Utilitas pursuant
to this notice, only together and in one block. (Both of the relevant
blocks of shares are hereinafter referred to as the Core Shares);
v. in order to transfer its Core Shares to the buyer who is not
connected to OÜ Utilitas, OÜ Utilitas shall require the consent of
the City of Tallinn, which may not be refused unreasonably if the
transferee is a strategic investor who meets the conditions defined
in the Shareholders Agreement.
vi. the transferee of the Core Shares must step in the Shareholders
Agreement to replace the shareholder who transferred its shares to
the transferee.
vii. if the City of Tallinn intends to sell its Core Shares, then in
certain cases, OÜ Utilitas shall also be entitled or obliged to sell
its shares in the Company's to the same transferee;
viii. if a shareholder, who is a party to the Shareholders Agreement, has
been declared bankrupt or the person having a direct control over OÜ
Utilitas has changed without a prior consent of the City of Tallinn
(in line with the definition in the Shareholders Agreement), the
relevant shareholder must sell its Core Shares to the other
shareholder who is a party to the Shareholders Agreement, if so
requested by the other shareholder; and
ix. in the event of issue of new shares of the Company, the shareholders,
who are parties to the Shareholders Agreement, may subscribe those
shares pro rata to their shareholding in the Company unless a
shareholder is unwilling to maintain the proportion of its
shareholding.
* The Shareholders Agreement has been entered into with the understanding and
expectation that the shares of the Company will remain listed on Nasdaq
Tallinn Stock Exchange. In the Shareholders Agreement, the City of Tallinn
and OÜ Utilitas have agreed not to vote in favour of any resolutions to
terminate the listing of the shares on Nasdaq Tallinn Stock Exchange without
having previously agreed on amendments to the Shareholders Agreement that
would take effect after the listing of the shares is terminated.
* The Shareholders Agreement shall terminate either upon a relevant written
agreement by all parties, liquidation of the Company or if one and the same
person becomes the owner of the Core Shares (and the B share until its
cancellation) owned by the City of Tallinn and OÜ Utilitas.
Laura Korjus
AS Tallinna Vesi
Head of Communications
(+372) 62 62 271
laura.korjus@tvesi.ee
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