Börsiteade

Pealkiri

Indrek Porila has began another litigation against Arco Vara AS

Teade

Arco Vara AS former employee Indrek Porila filed an action to the Harju County  
Court against Arco Vara AS (Arco Vara). In his application Indrek Porila demands
Arco Vara to pay principal claim in amount of EEK 21.0 mio (EUR 1.3 mio) and    
compensatory interest in amount of EEK 6.3 mio (EUR 0.4 mio), all in total in   
amount of EEK 27.3 (EUR 1.7 mio). Additional on that Indrek Porila demands to   
transfer into his possession 12.5% of the shares of Floriston Grupp OÜ belonging
to Arco Vara.                                                                   

Indrek Porila filed earlier this year a bankruptcy petition against Arco Vara   
and demanded to pay EEK 37.9 mio (EUR 2.4 mio). Court dismissed Indrek Proila's 
bankruptcy petition, finding the petition to be entirely unfounded.             

The  Management Board of Arco Vara AS stipulated on year 2007 in Initial Public 
Offering prospectus (IPO prospectus) that Indrek Porila has right for the bonus 
in amount of 12.5% from the equity capital of the Floriston Group, which is     
subject of payment after realization of Floriston Group's real estate projects. 
In IPO prospectus at 2007 the partial equity capital value at that time,        
calculated from the company´s goodwill was EEK 37.9 (EUR 2.4 mio). Since last   
autumn Indrek Porila didn't wanted to obtain 12.5% equity of the Floriston Grupp
OÜ which was agreed by oral agreement in year 2001, instead demanded Arco Vara  
to pay a sum mentioned in prior.                                                

On his current actions Indrek Porila has come up with entirely new position and 
contrary to his previous demands, started to demand both: money and transfer of 
the 12.5% of the shares of Floriston Grupp OÜ. Arco Vara does not acknowledged  
Indrek Porila´s such kind of claim contrary with the agreement, because none of 
the real estate projects on the basis of which the equity considered to be      
divided, has been unrealized.                                                   

Since Arco Vara has filed on April 30th, 2010 an action against Indrek Porila to
claim the damage, which Indrek Porila has caused to the company with his        
malicious bankruptcy petition. The Management Board of Arco Vara believes that  
Indrek Porila's current action is counterattack to pressurize Arco Vara to      
withdraw its action and other legal remedies.
                                   
Founded in 1992 Arco Vara is one of the leading property developers in the      
Baltic States. The main business of the company is property development, which  
is supported by the group's own property brokerage, valuation, construction and 
property management units. The company has representative offices in 17 towns   
across Estonia, Latvia, Ukraine and Bulgaria. The Group employees ca 160 people.

1 EUR=15.6466 EEK
                                                               
Lembit Tampere                                                                  
Member of the Management Board                                                  
Arco Vara AS                                                                    
Tel: +372 614 4630                                                              
[email protected]                                                                
http://www.arcorealestate.com