Official translation

Official translation Official translation REPUBLIC OF LITHUANIA Law on the Reorganisation of the Special Purpose Company “Lietuvos energija” 18 May 2000 No. VIII-1693 Vilnius Article

1. Purpose of the Law
2. This Law establishes the method and procedure of reorganisation of the Special Purpose Company “Lietuvos energija”.
3. The requirements of subparagraph 2 of paragraph 7 and paragraphs 9, 10, 11, 13 and 14 of Article 10 of the Company Law shall not apply to the reorganisation of the Special Purpose Company “Lietuvos energija”. Other laws of the Republic of Lithuania shall be applied in the Special Purpose Company “Lietuvos energija” reorganisation process to the extent this Law does not establish otherwise. Article
4. Method of Reorganisation
5. The Special Purpose Company “Lietuvos energija” shall be reorganised in accordance with the company division method, i.e. by separating certain portions of the assets, rights and liabilities from the Special Purpose Company “Lietuvos energija” which shall continue its activities, and setting up new companies on the basis of the above assets, rights and liabilities. Prior to the reorganisation of the Special Purpose Company “Lietuvos energija” by company division method (before the approval of the reorganisation project), a company shall be set up on the basis of assets of the subsidiary and municipal economy units assigned to the Company branch Lithuanian Power Plant; the ownership of shares in the newly set up company shall be transferred, upon the approval of the Government, to the municipality of Elektrėnai, reducing the amount of the authorised capital of the Special Purpose Company “Lietuvos energija” and the number of state-owned shares in the Special Purpose Company “Lietuvos energija”. Facilities of production and engineering infrastructure, social objects, buildings (their parts) belonging to the Special Purpose Company “Lietuvos energija” must be transferred, upon the approval of the Government, into the ownership of municipalities, reducing the authorised capital of the Special Purpose Company “Lietuvos energija” and the number of state-owned shares in the Special Purpose Company “Lietuvos energija”. A notice of the reduction of the authorised capital of the Special Purpose Company “Lietuvos energija” shall be published twice with an at least 14-day interval between the notices. A separate registration of the changes in the Articles of Association of the Special Purpose Company “Lietuvos energija”, related to the reduction of its authorised capital, shall not be made in the Register of Enterprises.
6. The property assigned to the regional branches of electricity network operation, except for the 330-kV transmission network and 110-kV network, by which electricity is transmitted from power plants, the 330-kV transformer substations as well as buildings, structures, equipment and other property required for their operation and management. At least two electricity distribution companies shall be set up on the basis of property assigned to the regional branches of electricity network operation which are being separated.
7. The property assigned to and used for the primary activity of the branches of the Special Purpose Company “Lietuvos energija” - the Lithuanian Power Plant, Kaunas “Energetikos remontas” and Mažeikiai Power Plant - shall be separated from the Special Purpose Company “Lietuvos energija”.
8. For the performance of its functions the Special Purpose Company “Lietuvos energija” which continues operation after reorganisation shall be assigned all the remaining property of the Special Purpose Company “Lietuvos energija” provided for in the reorganisation project, which has not been transferred to the newly set up companies. Article
9. Reorganisation Procedure
10. After the Seimas approves of the parts of the project for the reorganisation of distribution of the authorised capital and liabilities (obligations), submitted by the Government, and following the approval by the Government of the entire submitted reorganisation project, the general meeting of shareholders of the Special Purpose Company “Lietuvos energija” may by an at least 2/3 majority vote adopt a resolution to reorganise the Company and to approve the reorganisation project as well as the drafts of the Articles of Association of the companies being set up in the course of reorganisation.
11. It must be provided for in the Special Purpose Company “Lietuvos energija” reorganisation project that the shares of the companies set up on the basis of property of the subsidiaries and branches of the Special Purpose Company “Lietuvos energija” not engaged in its primary activity (Kruonis HAE (Pumped Storage Plant) Construction Board, Šiauliai Energy Facilities Construction Company, Electricity Network Construction Company, Ferro-concrete Supporting Blocks Company, Elektra Hotel as well as other economic or social facilities not engaged in electricity generation) must be transferred to the shareholders of the Special Purpose Company “Lietuvos energija” pro rata to the number of shares held by them in the Company, accordingly reducing the authorised capital of the Special Purpose Company “Lietuvos energija”. A public notice of the reduction of the authorised capital of the Special Purpose Company “Lietuvos energija” shall be published twice with an at least 14-day interval between the publications. A separate registration of the changes in the Articles of Association of the Special Purpose Company “Lietuvos energija”, related to the reduction of its authorised capital, shall not be made in the Register of Enterprises.
12. During the reorganisation, the property of the Special Purpose Company “Lietuvos energija” shall be assessed and calculated on the basis of residual balance-sheet value in accordance with the Law on the Principles of Accounting and other legal acts.
13. After the reorganisation of the Special Purpose Company “Lietuvos energija” shares of the Special Purpose Company “Lietuvos energija” shareholders shall be distributed proportionately to the authorised capital of the Special Purpose Company “Lietuvos energija” continuing its activities after the reorganisation and the authorised capital of the companies set up during the reorganisation.
14. The approved reorganisation project and minutes of the general meeting which approved it must be transferred to the registrar of the Register of Enterprises within 5 working days from the day of the meeting which approved the reorganisation project.
15. A notice of the reorganisation of the Special Purpose Company “Lietuvos energija” shall be published twice with an at least 14-days interval between the publications.
16. All rights and liabilities (obligations) of the Special Purpose Company “Lietuvos energija” which is undergoing reorganisation shall be transferred to the companies that will operate after the reorganisation. The Special Purpose Company “Lietuvos energija” which is undergoing reorganisation must furnish additional guarantees of the discharge of its liabilities to every creditor who presents an appropriate request. The right of claim against the Company “Belenergo” of the Republic of Belarus for the supplied electricity shall be transferred to the Special Purpose Company “Lietuvos energija” which continues its activities after the reorganisation. Debts to the Ignalina Nuclear Power Plant shall also be transferred to the Company.
17. The companies set up during the reorganisation of the Special Purpose Company “Lietuvos energija” and their Articles of Association shall be registered after the statutory meetings of shareholders pursuant to the Law on the Register of Enterprises. Instead of the Memorandum of Association the companies set up during the reorganisation shall present the minutes of the general meeting of shareholders of the Special Purpose Company “Lietuvos energija” which approved the reorganisation project.
18. The state guarantees extended to banks for loans granted to the Special Purpose Company “Lietuvos energija” shall also be valid for the companies operating after the reorganisation, which have taken over the liabilities deriving from the said loans.
19. The take-over of the liabilities of the Special Purpose Company “Lietuvos energija”, deriving from the loans received in the name of the government or with the government guarantee must be defined, upon agreement with the Ministry of Finance, in the Special Purpose Company “Lietuvos energija” reorganisation project.
20. Pending the adoption and entry into force of the Electricity Law and legal acts relating to the implementation thereof, the relations in the sphere of electricity generation, transmission, distribution and other spheres between the Company “Lietuvos energija” which continues operation after the reorganisation of the Special Purpose Company “Lietuvos energija” and the companies newly set up during the reorganisation must be defined in the Special Purpose Company “Lietuvos energija” reorganisation project.
21. Tax losses, incurred by the Special Purpose Company “Lietuvos energija” during the reorganisation, due to the deduction from the gross revenue according to the computation method specified in subparagraph 2 of paragraph 1 of Article 21 of the Law of the Republic of Lithuania on Taxes on Profits of Legal Persons of the funds earmarked for investment, shall be proportionately carried forward taking into the account that share of acquisition value of the remaining tangible long-term assets of the Special Purpose Company “Lietuvos energija” continuing operation after the reorganisation and of the tangible long-term assets transferred to the companies set up in the course of the reorganisation, to which the method for the computation of funds assigned for investment, specified in subparagraph 2 of paragraph 1 of Article 21 of the Law of the Republic of Lithuania on Taxes on Profits of Legal Persons, has been applied. I proclaim this Law enacted by the Seimas of the Republic of Lithuania. PRESIDENT OF THE REPUBLIC VALDAS ADAMKUS